2013 (2) TMI 542 - AT - Central Excise

Waiver of pre-deposit - Stay of recovery - Rule 25 of the Central Excise Rules, 2002 - Notification No.21/2002 - Notification No.6/2006 - Mega Power Project - Assessee is a manufacturer of power plant Boilers Auxiliaries - Held that - All though initially the certificate shows it is an expansion of Mega Power Project but the subsequent certificate issued by the Joint Secretary, Ministry of Power clearly certifying the plant to whom applicants supplied the impugned goods are intended for separate and new Mega Power Projects. Prima facie the applicants are entitled for the exemption claimed by them. Pre-deposit waive

Summary

Issues:
Interpretation of Notification No.6/2006-CE dated 1.3.2002 and Notification No.21/2002 dated 1.3.2002 for duty exemption. Validity of duty demand, interest, and penalty under Rule 25 of the Central Excise Rules, 2002. Request for waiver of predeposit and stay of recovery during appeal based on certification of power plant projects as new.

Interpretation of Notification No.6/2006-CE and Notification No.21/2002:
The judgment dealt with the denial of duty exemption under Notification No.6/2006-CE dated 1.3.2002 and Notification No.21/2002 dated 1.3.2002. The duty demand of Rs.10,18,31,467/- was confirmed against the applicant, along with interest and penalty under Rule 25 of the Central Excise Rules, 2002. The dispute arose from the classification of the power plant projects supplied by the applicant as either an expansion of an existing plant or as new projects. Initially, it was considered an expansion, leading to the denial of the exemption. However, a subsequent certificate from the Joint Secretary, Ministry of Power, clarified that the projects were new power plants, not expansions. This clarification played a crucial role in determining the eligibility for exemption.

Validity of Duty Demand, Interest, and Penalty:
The Tribunal examined the facts presented by both parties and noted the discrepancy between the initial certificate indicating expansion and the subsequent certificate confirming the projects as new. The applicant argued that the certificate from the Joint Secretary clearly certified the projects as new power plants. Upon reviewing the records, the Tribunal found that the subsequent certification supported the applicant's claim for exemption. Consequently, the Tribunal held that the applicants were prima facie entitled to the exemption claimed, leading to a decision to waive the requirement of predeposit of the duty, interest, and penalty amount. Additionally, the Tribunal granted a stay on the recovery of the disputed amount during the appeal process.

Request for Waiver of Predeposit and Stay of Recovery:
The applicants sought a waiver of predeposit and a stay on the recovery of the demanded amount during the appeal. The Tribunal considered the certification provided by the Joint Secretary, Ministry of Power, which clarified the nature of the power plant projects supplied by the applicants. Based on the subsequent certification confirming the projects as new power plants, the Tribunal acknowledged that the applicants had made a case for 100% waiver of the predeposit of the duty, interest, and penalty. Consequently, the Tribunal granted the waiver and stayed the recovery of the disputed amount throughout the appeal proceedings.