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2015 (7) TMI 308 - AT - Central ExciseWaiver of pre deposit - Denial of the benefit of Notification No.10/1997 dt. 01/03/1997 - Direct supply of goods not done - Held that - Assessee have already paid 5% of the value of the same in terms of the provisions of Rule 6(3) of CENVAT Credit Rules inasmuch as they were availing CENVAT credit in respect of common inputs. The said amount comes to around ₹ 1.22 lakhs (approximately). By treating the same as sufficient, we dispense with the condition of predeposit of balance dues and entire interest and penalty - Stay granted.
Issues: Denial of benefit of Notification No.10/1997 for goods supplied to contractors instead of National Aeronautics Ltd. (NAL); Requirement of certificate signed by Director for exemption; Confirmation of demand; Consideration of CENVAT credit payment in lieu of balance dues.
In this judgment by the Appellate Tribunal CESTAT Bangalore, the primary issue was the denial of the benefit of Notification No.10/1997 to the appellants for goods supplied to contractors working with National Aeronautics Ltd. (NAL) instead of directly to NAL itself. The Revenue contended that the benefit of the notification could not be extended due to this indirect supply chain. Another objection raised was the non-compliance with the condition of the notification, which required a certificate signed by the Director confirming the use of items in research applications. The appellants had provided a certificate signed by the Senior Deputy Secretary to the Director, which was deemed insufficient by the Revenue, leading to the initiation of proceedings and the confirmation of a demand amounting to Rs. 2,01,880. Furthermore, the appellants argued that they had already paid 5% of the value of the goods as per Rule 6(3) of the CENVAT Credit Rules by treating the goods as exempt and availing CENVAT credit for common inputs, resulting in a payment of approximately Rs. 1.22 lakhs. Considering this payment as sufficient, the Tribunal decided to dispense with the requirement of predeposit for the balance dues, interest, and penalty. As a result, the stay petition was disposed of in the above manner, with the order being pronounced and dictated in open court.
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