2012 (9) TMI 865 - AT - Central Excise

Waiver of pre deposit - Benefit of Notification No. 214/86-C.E., dated 25-3-1986 - CENVAT Credit - Held that - Considering the fervent plea of financial hardships raised by the learned counsel albeit without documentary evidence, we take the view that the amount of Rs. 15 lakhs deposited by the assessee-appellant would suffice the purpose of Section 35 of the Central Excise Act. However, in the absence of plea of financial hardships by other appellants, we are inclined to direct reasonable pre-deposits - Conditional pre deposit granted.

Summary

Issues involved: Delay in filing appeals, Stay applications for waiver and stay of dues, Compliance with Notification No. 214/86-C.E., Financial hardships for pre-deposit.

Analysis:
1. Delay in filing appeals: The Tribunal found the 7-day delay in filing the appeals to be satisfactorily explained and allowed the COD applications.

2. Stay applications for waiver and stay of dues: The main appellant/assessee was aggrieved by a demand of over Rs. 62 lakhs and an equal amount of penalty. Other appellants were aggrieved by penalties imposed on them under Rule 26 of the Central Excise Rules, 2002. The Tribunal noted that the assessee claimed the benefit of Notification No. 214/86-C.E., dated 25-3-1986, for job work undertaken for a beverage manufacturer without availing CENVAT credit. However, the Tribunal found non-compliance with the conditions of the Notification, as there was no evidence of declaration from the beverage manufacturer or use of job-worked goods in the manufacture of excisable products. The Tribunal also observed that the beverage manufacturer did not manufacture any excisable product, raising doubts about their status as the 'principal manufacturer' for the job work. The Tribunal acknowledged the payment of Rs. 15 lakhs by the appellant before the show-cause notice was issued and considered the plea for waiver and stay due to financial hardships.

3. Compliance with Notification No. 214/86-C.E.: The Tribunal found that the conditions of the Notification were not satisfied, leading to the denial of the benefit to the assessee. Lack of evidence regarding declaration from the beverage manufacturer and use of job-worked goods in manufacturing raised doubts about the claim for exemption.

4. Financial hardships for pre-deposit: While the Tribunal found the Rs. 15 lakhs deposited by the main appellant sufficient under Section 35 of the Central Excise Act, it directed other appellants to make reasonable pre-deposits of Rs. 25,000 each towards the respective penalties within six weeks. Compliance was to be reported to the Assistant Registrar by specific dates, and subject to due compliance, waiver of pre-deposit and stay of recovery were granted for the balance amounts of penalties, duty, and interest.

This comprehensive analysis of the judgment covers the issues of delay in filing appeals, stay applications for waiver and stay of dues, compliance with Notification No. 214/86-C.E., and financial hardships for pre-deposit, providing a detailed overview of the Tribunal's findings and decisions on each issue.