2013 (11) TMI 1117 - AT - Central Excise

Availment of the benefit of exemption Notification No. 58/2008 and 59/2008 Non-maintenance of Separate books - Waiver of Pre-deposit Held that - The dispute relating to availment of the benefit of both the exemption notification simultaneously would be looked into at the time of hearing the appeal - The applicant has not maintained books of accounts separately as clarified in the Board s Circular Thus, the applicant has failed to make out a prima facie case for waiver of entire amount of duty, interest and penalty - The applicant directed to pre-deposit a sum of Rupees two lakh fifty thousand as pre-deposit Upon such submission rest of the duty to be waived till the disposal Partial stay granted.

Summary

Issues:
1. Availment of CENVAT credit on goods cleared at nil rate of duty under Notification No.29/2004-CE.
2. Eligibility to avail benefit of multiple notifications simultaneously.
3. Requirement to maintain separate books of accounts for goods availing different notifications.

Analysis:
The case involved the applicants engaged in manufacturing 100% cotton yarn who cleared goods at nil rate of duty under Notification No.29/2004-CE but were denied CENVAT credit under Rule 6(4) of the CENVAT Credit Rules, 2004. The dispute centered around the eligibility to avail both Notification No. 58/2008-CE (nil duty) and No.59/2008-CE simultaneously. The counsel argued for eligibility based on a High Court decision, while the AR contended that since goods were cleared at nil rate of duty, CENVAT credit was not permissible. The AR also highlighted the requirement to maintain separate books of accounts for goods availing different notifications, which the applicants failed to do.

Upon hearing both sides, the Tribunal acknowledged that the dispute regarding the simultaneous availment of exemption notifications would be examined during the appeal hearing. However, it was noted that the applicants did not maintain separate books of accounts as per the Board's Circular, leading to a failure to establish a prima facie case for waiver of duty, interest, and penalty. Consequently, the applicants were directed to pre-deposit a specified amount within six weeks, with the balance dues pre-deposit waived and recovery deferred during the appeal process.

Additionally, the Revenue's application to expedite the appeal hearing was rejected. The judgment emphasized the importance of complying with procedural requirements, specifically the maintenance of separate books of accounts for goods benefiting from different notifications, and the need to establish a prima facie case for the waiver of duties and penalties during legal proceedings.