2014 (1) TMI 683 - AT - Central Excise

Denial of Cenvat credit Goods used for supporting structures to the plant and machinery Waiver of Pre-deposit Held that - Held that - Following Vandana Global Ltd. Versus CCE 2010 (4) TMI 133 - CESTAT, NEW DELHI (LB) - the invocation of extended period will have to be considered in great detail and that may not be possible at this stage - prima facie, in view of the conflicting decisions during the relevant time, the appellant can be said to have made out a case for waiver of pre-deposit - the appellant has not deposited the interest on the CENVAT credit - the appellant is directed to deposit Rupees Five lakhs as pre-deposit upon such submission rest of the duty to be stayed till the disposal Partial stay granted.

Summary

Issues involved:
- Eligibility for CENVAT credit on steel items
- Time-barred demand of CENVAT credit
- Invocation of extended period of limitation
- Intentional availing of credit due to clerical error
- Basis of bona fide belief
- Waiver of pre-deposit
- Liability for interest on CENVAT credit

Eligibility for CENVAT credit on steel items:
The issue revolved around whether the appellant was entitled to CENVAT credit of Rs. 55,39,230 on various steel items used for supporting structures in the factory. The appellant argued that the demand was time-barred, citing conflicting decisions before the Vandana Global Ltd. case. The appellant also contended that the availed credit of Rs. 16,79,500 was due to a clerical error and was promptly reversed. The Additional Commissioner argued that the extended period was rightly invoked due to lack of bona fide belief and non-disclosure in returns.

Invocation of extended period of limitation:
The Tribunal acknowledged the conflicting views on availing CENVAT credit on steel items before the Vandana Global Ltd. case. Considering the conflicting decisions during the relevant period, the Tribunal found that the appellant had made a case for waiver of pre-deposit. However, the Tribunal noted that the appellant had not deposited the interest on the availed credit of Rs. 16,79,500, which was an admitted liability.

Waiver of pre-deposit:
In light of the circumstances, the Tribunal directed the appellant to deposit Rs. 5,00,000 within six weeks. Upon compliance, the requirement of pre-deposit for the remaining dues was waived, and the stay of recovery was granted during the appeal's pendency. The decision was pronounced and dictated in open court by B. S. V. Murthy.