2014 (7) TMI 944 - HC - Central Excise

Waiver of pre-deposit - waste steam constitutes an input - generation of electricity - captive consumption as well as sale to outside parties - exemption notification No.4/97 - Held that - Since the Tribunal has not had the benefit of considering the ambit and application of the aforesaid notifications, we consider it appropriate in the interest of justice to set aside the impugned order of the Tribunal and to restore the proceedings before the Tribunal for reconsideration of the application for stay afresh insofar as the order of pre-deposit on steam is concerned. - matter remanded back to tribunal.

Summary

Issues:
1. Application for waiver of pre-deposit before the Customs, Excise and Service Tax Appellate Tribunal.
2. Interpretation of exemption notifications regarding duty on steam consumed for electricity generation.
3. Tribunal's decision on waiver of pre-deposit for demands related to steam and furnace oil consumption.

Analysis:
The High Court of Bombay heard an appeal arising from an order of the Customs, Excise and Service Tax Appellate Tribunal concerning the waiver of pre-deposit. The Appellant sought a waiver of demands related to steam and furnace oil consumed for electricity generation. The Tribunal granted a waiver for the demand related to furnace oil but directed the Appellant to deposit the entire amount for the demand related to steam consumption.

The Appellant contended that during the period of 1997-2001, various exemption notifications prescribed a nil rate of duty for steam consumed in electricity generation. The notifications relied upon included No.4/97, No.24/97, No.5/98, No.5/99, No.6/2000, No.3/2001, and No.125/1984. However, the Tribunal did not consider the scope and application of these notifications in its decision.

In the interest of justice, the High Court set aside the Tribunal's order and remitted the proceedings for reconsideration. The Court did not express any view on the merits of the case but directed the Tribunal to reexamine the application for waiver of pre-deposit specifically concerning the steam consumption issue. The Appellant's waiver, not contested, remained unaffected by this decision. The appeal was disposed of without any order as to costs.