2014 (11) TMI 498 - HC - Central Excise

Waiver of pre deposit - SSI exemption - Held that - The specific case of the assessee was that in a similar case, the Tribunal, in 2009 (11) TMI 389 - CESTAT, CHENNAI , in the case of Data Tech Systems v. Commissioner of Central Excise, Coimbatore held that duty demand within the normal period should be recalculated and imposition of penalty should be considered afresh. Further, it was pointed out that in the case of 2010 (2) TMI 1120 - CESTAT CHENNAI (Sumangala Steels (P) Ltd. v. CCE), the Tribunal has held that the time limit for demand of short-paid duty was only six months prior to the period 2000. The learned counsel appearing for the appellant asserts that the decision in the case of Data Tech Systems v. Commissioner of Central Excise, Coimbatore (cited supra) has been accepted by the Revenue. Thus, taking note of the status of the assessee as SSI unit, apart from the prima facie case made out, we are of the view that the assessee would be entitled for complete waiver of pre-deposit - stay granted.

Summary

Issues:
1. Challenge against the Tribunal's order directing pre-deposit.
2. Allegation of discriminatory treatment by the Tribunal.
3. Allegation of lack of foundation for the impugned order.
4. Ignoring appellant's submissions regarding the Tribunal's decisions.
5. Consideration of waiver of pre-deposit based on the plea of limitation.

Analysis:

1. The appellant challenged the Tribunal's order directing pre-deposit of Rs. 6,00,000 within six weeks. The appellant contended that a similar matter in Data Tech Systems v. Commissioner of Central Excise had a favorable outcome for the appellant, questioning the invocation of extended limitation period by the Department. The Tribunal's decision was based on a different case without considering the appellant's arguments, leading to the appeal against the pre-deposit order.

2. The appellant argued hostile discrimination by the Tribunal in applying the pre-deposit order without proper foundation or consideration of past favorable decisions. The appellant highlighted the health condition of the proprietor, who was incapacitated due to a stroke, as a mitigating factor in seeking a waiver of pre-deposit.

3. The Revenue sought to uphold the Tribunal's order, citing reasons provided in the impugned decision. However, the appellant's counsel presented precedents and legal arguments to challenge the Tribunal's decision, emphasizing the acceptance of similar cases by the Revenue in the past.

4. The High Court analyzed the submissions from both parties and reviewed the materials on record. The Court noted the appellant's reliance on previous Tribunal decisions and the Revenue's failure to counter the appellant's assertions regarding the plea of limitation.

5. Considering the prima facie case made by the appellant and the status of the appellant as a Small Scale Industry (SSI) unit, the Court found merit in granting a complete waiver of the pre-deposit. The Court allowed the Civil Miscellaneous Appeal, setting aside the Tribunal's order and directing the Tribunal to proceed with the appeal on its merits, with a stay on recovery until the appeal's disposal. The connected Miscellaneous Petition was closed as a consequence of the judgment.