2014 (1) TMI 267 - AT - Central Excise

Goods cleared to DTA Assessee being 100% EOU Waiver of Pre-deposit Held that - Following COMMISSIONER OF CENTRAL EXCISE, CHENNAI Versus ORCHID HEALTH CARE 2009 (8) TMI 931 - CESTAT CHENNAI - the applicant cleared the damaged containers - thus, the duty demand is not sustainable - Prima facie, the demand of duty is not sustainable on such clearance Pre-deposits waived till the disposal Stay granted.

Summary

Issues Involved: Duty demand on cleared containers without payment, waiver of pre-deposit of duty, penalty, and interest.

Analysis:

Issue 1: Duty demand on cleared containers without payment
The applicant, a 100% EOU engaged in manufacturing 'bulk drugs,' received goods without duty payment under an exemption notification for use in final products. Allegations arose when the applicant cleared empty containers after utilizing their contents without paying duty in the DTA and subsequently sold the containers. The Revenue demanded duty and penalties for the period in question. The applicant contended that they cleared used and damaged containers, making the duty demand unsustainable. Referring to a previous decision in the applicant's favor, the Tribunal found that the demand of duty was not sustainable on clearance of damaged containers. Consequently, the Tribunal waived the pre-deposit of duty, interest, and penalty, staying the recovery until the appeal's disposal.

Issue 2: Waiver of pre-deposit of duty, penalty, and interest
Considering the submissions from both parties, the Tribunal determined that the demand of duty on cleared damaged containers was not sustainable. Citing a previous favorable decision in the applicant's case, the Tribunal granted a waiver of pre-deposit of duty, penalty, and interest. The Tribunal found it appropriate to waive the pre-deposit and stay the recovery of duty, interest, and penalty until the final disposal of the appeal. This decision was made after a thorough examination of the facts and legal precedents, ensuring fairness and justice in the proceedings.

In conclusion, the Tribunal addressed the duty demand issue on cleared containers without payment and decided to waive the pre-deposit of duty, penalty, and interest, providing relief to the applicant until the appeal's final resolution. The judgment reflects a balanced approach, considering the applicant's contentions and legal precedents to arrive at a fair and just decision.