2012 (10) TMI 622 - AT - Central Excise

Stay petition - demand is confirmed in respect of sugar syrup used in the manufacture of exempted biscuits - contention of the applicants is that with effect from 12.09.2011 the sugar syrup is exempted from payment of duty which is used in the manufacture of exempted goods vide Notification no. 39/11-CE Held that - Matter remanded to the adjudicating authority after waiving pre-deposit

Summary

Issues:
1. Restoration of Stay petition
2. Waiver of pre-deposit of dues for sugar syrup used in exempted biscuits
3. Classification of sugar syrup and liability to duty

Restoration of Stay petition:
The judgment addressed the application filed for restoration of the Stay petition, where the applicants were late for the hearing, resulting in the dismissal of the stay petition. The Tribunal recalled the ex-parte order and restored the stay petition to its original number based on the reasons explained by the applicants.

Waiver of pre-deposit of dues for sugar syrup used in exempted biscuits:
The applicants sought waiver of pre-deposit of dues as the demand was confirmed for sugar syrup used in the manufacture of exempted biscuits. They argued that the sugar syrup became exempt from duty from 12.09.2011 as per Notification no. 39/11-CE. The Government had initiated surveys following representations from biscuit manufacturers, and the matter was pending. The applicants relied on a Tribunal decision in a similar case for waiving pre-deposit of dues, emphasizing their strong case for waiver due to manufacturing biscuits for a specific company.

Classification of sugar syrup and liability to duty:
The Revenue contended that sugar syrup is classifiable under chapter 17.90 and, being used in the manufacture of exempted biscuits, is considered an intermediate product, thereby making the applicants liable to duty. However, considering the representations and surveys initiated by the Government, and the Tribunal's decision in a related case, the Tribunal waived the pre-deposit of dues and stayed the recovery during the appeal's pendency.

In conclusion, the Tribunal allowed the Stay petitions, considering the circumstances and arguments presented by both parties, ultimately granting relief to the applicants by waiving the pre-deposit of dues and staying the recovery during the appeal process.