2014 (4) TMI 9 - AT - Central Excise

Waiver of pre deposit - Duty demand - Invocation of extended period of limitation - Held that - applicants had already deposited Rs. 27 crores in cash. We also note that in the case of JCB vs CCE, Pune (2014 (2) TMI 632 - CESTAT MUMBAI) the issue is held in favour of the assessee by the Commissioner of Central Excise and the Tribunal allowed the appeal filed by Revenue and upheld the demand of normal period of limitation. In these circumstances, particularly in view of the contention of the applicants regarding availability of credit, we find that amount already deposited is sufficient for hearing of the appeals. Pre-deposit of the remaining dues is waived and recovery thereof stayed for hearing of the appeals - Stay granted.

Summary

Issues:
1. Waiver of duty, interest, and penalty
2. Confiscation of goods and imposition of redemption fine
3. Classification of parts as automobile or earthmoving equipment
4. Invocation of extended period of limitation
5. Pre-deposit of remaining dues and stay of recovery

Analysis:

1. The judgment addresses the application filed by M/s. Larsen & Toubro Ltd for the waiver of duty amounting to Rs.161,61,27,251/- along with interest and penalty. Additionally, the adjudicating authority confiscated the goods and imposed a substantial redemption fine of Rs.374 crores. Other applicants also sought waivers for penalties.

2. The demand was confirmed based on the activity undertaken by the applicants involving packing, repacking, labeling, relabeling, and affixing of MRP on the parts. The applicants contested this demand by arguing that the parts are related to earthmoving equipment, not automobiles. The adjudicating authority upheld the demand, invoked the extended period of limitation, imposed penalties, and held the goods liable for confiscation along with a redemption fine.

3. The Tribunal referred to a previous case, CCE vs JCB Ltd, where it was established that earthmoving equipment falls under the category of automobiles. Consequently, the applicants were deemed liable to pay duty for the parts cleared after various processes, including packing and labeling.

4. The issue of the extended period of limitation was raised by the applicants, highlighting that the demand exceeded the normal limitation period. They also argued for the benefit of duty paid on inputs and Service Tax paid on input services, reducing the demand significantly to around Rs.24 crores for the entire period. The applicants had already deposited Rs.27 crores during the adjudicating proceedings, which was deemed sufficient for the appeals' hearing.

5. Considering the facts, the Tribunal found that the pre-deposit made by the applicants, along with the settled issue from a previous case, warranted the waiver of the remaining dues. The recovery of the outstanding amount was stayed to facilitate the hearing of the appeals, with the Registry directed to list the appeals for regular hearing on a specified date. Ultimately, the stay petitions were allowed, providing relief to the applicants.