2015 (3) TMI 1042 - HC - Central Excise

Waiver of pre deposit - case of the appellant was that the appellant has not received fair consideration before the Tribunal, inasmuch as, its Application for exemption from pre-deposit has not been considered on merits - Held that - In the impugned order, there is no reference to the case of the appellant as such or its contentions. We further notice that there is no reference to the order of the Tribunal, which was passed in the year 1999, which, according to the appellant, should have received far greater significance in the decision in Stay Application. - impugned order must be modified and in place of ₹ 1.58 crores, the appellant must deposit a sum of ₹ 80 lacs. - Decided partly in favour of assessee.

Issues:
1. Appeal under Section 35 G of the Central Excise Act, 1994 against Annexure-3 order.
2. Disposal of duty demands against the appellant for various resins used in manufacturing final products.
3. Consideration of exemption from pre-deposit by the Tribunal.
4. Interpretation of marketability of resin products for excise duty.
5. Application of earlier Tribunal orders and Supreme Court judgments.
6. Jurisdiction and discretion of the Tribunal in directing pre-deposit.
7. Compliance with pre-deposit requirements and modification of the impugned order.

Analysis:

1. The appeal was filed under Section 35 G of the Central Excise Act, 1994, challenging the Annexure-3 order by the Customs, Excise And Service Tax Appellate Tribunal (Tribunal). The appellant was directed to deposit fifty per cent of the confirmed duty amount of approximately &8377; 4.06 crores within eight weeks.

2. The duty demands were raised against the appellant for various resins used in manufacturing final products, benefiting from area-based exemption notification. The Tribunal confirmed the demands invoking the longer period of limitation, leading to the pre-deposit order against the appellant.

3. The appellant contended that their Application for exemption from pre-deposit was not properly considered by the Tribunal. The appellant argued that resin products captively consumed in manufacturing final products were not marketable, citing the decision in Moti Laminates Pvt. Ltd. case by the Supreme Court.

4. The issue of marketability of resin products for excise duty was crucial. The Tribunal was urged to follow the Supreme Court's decision and earlier Tribunal judgments, emphasizing that certain resin products were not dutiable as they were not marketable.

5. The Tribunal's jurisdiction and discretion in directing pre-deposit were questioned. The appellant sought relief based on undue hardship and the need to safeguard revenue interests, as outlined in the Benara Valves Ltd. case by the Supreme Court.

6. The Tribunal's order was modified to reduce the pre-deposit amount from &8377; 1.58 crores to &8377; 80 lacs, considering the interests of justice. The appellant was directed to deposit &8377; 40 lacs within three weeks, accounting for the amount previously deposited as an interim measure.

7. The judgment highlighted the importance of fair consideration, proper application of legal principles, and adherence to procedural requirements in excise duty matters, ensuring a balance between taxpayer rights and revenue protection.

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