2011 (11) TMI 563 - AT - Central Excise

Waiver of pre-deposit - Appellant had clandestinely manufactured the finished goods and cleared the same - appellant was not able to reconcile the stock of raw material which he purchased and the finished goods manufactured and cleared from the said raw material - Held that - Demand of duty has arisen on the finished goods allegedly manufactured out of shortage of raw material detected by the Revenue officers during the course of visit. On perusal of the records, we find that there is no evidence on record or brought on record by the Revenue indicating clandestine manufacture and removal of the goods - Prima facie, we are of the view that the appellant has been able to make out a case for complete waiver of pre-deposit of amounts confirmed by lower authorities. Accordingly, application for waiver of pre-deposit of amounts confirmed is allowed and recovery thereof stayed till the disposal of the appeals - Stay granted.

Summary

Issues:
Waiver of pre-deposit of duty liability, interest, penalty under Section 11AC of Central Excise Act, and personal penalty on the authorized signatory.

Analysis:
The Stay Petition was filed seeking waiver of pre-deposit of an amount confirmed as duty liability, interest, penalty under Section 11AC of Central Excise Act, and a personal penalty. The duty liability was upheld due to allegations of clandestine manufacture and clearance of finished goods. The adjudicating authority and the first appellate authority confirmed the duty based on discrepancies in reconciling raw material purchased with finished goods manufactured and cleared. However, upon review, the Tribunal found no concrete evidence of clandestine activities in the records or presented by the Revenue officers.

The Tribunal carefully considered the submissions from both sides and concluded that the demand for duty was based on finished goods allegedly manufactured from a shortage of raw material observed during a visit by Revenue officers. Despite this, the Tribunal noted the absence of evidence indicating clandestine manufacture and removal of goods. Consequently, the Tribunal was inclined to believe that the appellant had made a case for complete waiver of the pre-deposit amounts confirmed by the lower authorities. Therefore, the application for waiver of pre-deposit of the confirmed amounts was allowed, and the recovery was stayed pending the disposal of the appeals. The decision was made to grant a complete waiver of the pre-deposit amounts based on the lack of evidence supporting the allegations of clandestine activities, providing relief to the appellant until the final resolution of the appeals.