2014 (10) TMI 235 - AT - Central Excise

Waiver of pre deposit - ineligible Cenvat credit availed by the appellant - Held that - On perusal of the said stay order and the records, we find that the appellant has made out a case for the waiver of the pre-deposit of the amounts involved, as there is no condition in Notification No. 2/2008 which restricts the application of the said notification in respect of the goods manufactured and cleared under the Notification No. 4/2006-C.E.; we also find strong force in the contention raised by the ld. Counsel that the order of this Bench in the case of Arvind Ltd. & Arvind Polycot 2011 (11) TMI 557 - CESTAT AHMEDABAD is essentially on the same issue but the said stay order is in respect of textile and products wherein similar issue was involved. We are of the view that the appellant has made out a prima facie strong case for the waiver of the pre-deposit of the amounts involved. Application for waiver of the pre-deposit of the amounts involved is allowed and recovery thereof stayed till the disposal of the appeal - Stay granted.

Summary

Issues:
1. Waiver of pre-deposit of Cenvat credit confirmed as ineligible.
2. Interpretation of Notification No. 2/2008-C.E. and its applicability.
3. Comparison with previous case law regarding similar issues.

Analysis:

1. The appellant filed a stay petition seeking waiver of pre-deposit of an amount confirmed as ineligible Cenvat credit availed during a specific period, along with interest and penalty under Rule 15(1) of the Cenvat Credit Rules, 2004. After hearing both sides and examining the case records, the Tribunal considered the appellant's manufacturing activities involving dutiable and exempted medicaments under relevant notifications.

2. The appellant claimed the benefit of Notification No. 2/2008-C.E. during the period in question for goods cleared for exports, while also availing the benefit of Notification No. 4/2006-C.E. for goods cleared for home consumption without charging excise duty. The Tribunal noted that there was no restriction in Notification No. 2/2008 on its application to goods manufactured and cleared under Notification No. 4/2006. Referring to a previous stay order related to a different case involving textiles, the Tribunal found merit in the appellant's argument and allowed the waiver of pre-deposit, staying the recovery until the appeal's disposal.

3. By comparing the current case with the precedent mentioned, the Tribunal acknowledged the similarity in issues despite the different products involved. The Tribunal recognized a strong prima facie case for granting the waiver of pre-deposit based on the interpretation of relevant notifications and the appellant's submissions. The decision to allow the waiver and stay recovery reflected the Tribunal's assessment of the appellant's case as being strong and deserving of relief pending the appeal's final resolution.