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TMI Blog2009 (6) TMI 29X X X X Extracts X X X X X X X X Extracts X X X X ..... r Section 11A & 11AB of the Central Excise Act, 1944 and the amount of Rs.2,54,805/- already paid should not be appropriated and adjusted against the total amount so payable; (ii) Penalty under Rule 25 of Central Excise Rules, 2002 read with Section 11AC of the Central Excise Act, 1944 should not be imposed upon them; (iii) CENVAT Credit amounting to Rs.6,21,39,585/- wrongly availed and utilised should not be demanded and recovered from them under Rule 14 of CENVAT Credit Rules, 2004 read with Section 11A of Central Excise Act, 1944; (iv) Interest should not be recovered from them under Rule 14 of CENVAT Credit Rules, 2004 on the amount of credit wrongly availed and utilised read with Section 11AC of the Central Excise Act, 1944; and (v) Penalty under Rule 15 of CENVAT Credit Rules, 2004 read with Section 11AC of the Central Excise Act, 1944 should not be imposed on them for the amount of credit wrongly availed and utilized by them. The appellant filed a detailed reply to the show cause notice vide letter dated 10.03.2008 and 20th of August, 2008 contesting the allegations made in the show cause notice on diverse grounds including that the demand was barred by time and the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt of the Punjab & Haryana High Court in the case of Ambuja Cements Ltd. Vs. Union of India & Ors., 2009 TIOL 110 as well as Board Circular No. 97/8/2007-ST dated 23.08.2007 and the decision dated 18.05.2009 of the larger Bench of the Tribunal at Banglore, which still holds the field, the appellant was entitled to avail the CENVAT Credit against onward transportation of goods and, thus, had a very strong prima facie case and order of the Tribunal directing to make a deposit of Rs.1crore, in the circumstances, is totally illegal and unjustified. It has next been submitted that various Benches of tribunal throughout the country in identical facts and circumstances have waived the condition of pre-deposit, hence, the appellant was also entitled for a full waiver. In support thereof, various orders passed by different Benches of the tribunal has been produced before me. In reply, it has been submitted by Shri Shambhu Chopra appearing for the respondent that the appellant company being a profit making company has means to deposit a sum of Rs.1crore as directed by the tribunal as pre-deposit and there is no reason to interfere with the impugned order. It has further been submitted that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the CENVAT Credit Rules, 2004 and thereby enabling the manufacturer to take credit of the service tax on the value of such service. Section 35 B of the Act provides for an appeal against the order passed by Commissioner of Central Excise exercising power as adjudicating authority before the Appellate Tribunal. Section 35 F of the Act prescribes condition of pre-deposit of duty demanded and the penalty levied for maintaining the appeal by the assessee. However under proviso, the tribunal has been vested with the powers to dispense with such deposit, on forming an opinion that such deposit may cause undue hardship, subject to such conditions as it may deem fit in order to safeguard the revenue. Section 35 F reads as under. "35 F. Deposit, pending appeal of duty demanded or penalty levied.- Where in any appeal under this Chapter, the decision or order appealed against relates to any duty demanded in respect of goods which are not under the control of central excise authorities or any penalty levied under this Act, the person desirous of appealing against such decision or order shall, pending the appeal, deposit with the adjudicating authority the duty demanded or the penalty lev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n of undue hardship. The order of the Tribunal should show if the pleas raised before it, have any merit prima facie or not. If the appellant has such a prima facie strong case as is most likely to exonerate him from payment and still the Tribunal insists on the deposit of the amount it would amount to undue hardship." A Division Bench of this Court in the case of I.T.C. Ltd. Vs. Commissioner (Appeals), Customs & Central Excise, [2005 (184) E.L.T. 347 (All.)] held as follows. "While considering the application for stay/waiver of a pre-deposit, as required under the law, the Court must apply its mind as to whether the appellant has a strong prima facie case on merit. In case it is covered by the judgment of a Court/Tribunal binding upon the Appellate Authority, it should apply its mind as to whether in view of the said judgment, the appellant is likely to succeed on merit. If an appellant having strong prima facie case, is asked to deposit the amount of assessment so made or penalty so levied, it would cause undue hardship to him, though there may be no financial restrain on the appellant running in a good financial condition. The arguments that appellant is in a position to dep ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... im order of protection should not be passed. But, if on a cursory glance it appears that the demand raised has no legs to stand on, it would be undesirable to require the assessee to pay full or substantive part of the demand. Petitions for stay should not be disposed of in a routine matter unmindful of the consequences flowing from the order requiring the assessee to deposit full or part of the demand. There can be no rule of universal application in such matters and the order has to be passed keeping in view the factual scenario involved. Merely because this Court has indicated the principles that does not give a licence to the forum/authority to pass an order which cannot be sustained on the touchstone of fairness, legality and public interest. Where denial of interim relief may lead to public mischief, grave irreparable private injury or shake a citizen's faith in the impartiality of public administration, interim relief can be given." The Hon'ble Supreme Court again in the case of Bhavya Apparels Pvt. Ltd. Vs. Union of India, 2007 (216) E.L.T. 347 (S.C.) has observed as under. " The learned Additional Solicitor General very fairly submits that a part of the goods is in cus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ercised. Such like cases where two views are not possible then the condition of pre-deposit before the appeal is heard on merits, can be dispensed with. In case two views are possible on interpretation, based on conflicting judgments of the Tribunal or different High Courts in the absence of the judgment of the jurisdictional High Court then the authorities may pass the order under proviso to Section 35F of the Act keeping in view the facts of the case in hand." In view of above exposition of law, the arguments advanced on behalf of revenue have no force. The tribunal has to maintain a balance between the interest of revenue and rights and interests of an individual and should not refrain itself from exercising the discretionary powers conferred by the Statute, if the facts and circumstances of the case so justify, merely on the pretext that interest of revenue cannot be jeopardized. In the case in hand, a specific plea was set up by the appellant that matter is covered by decision of Punjab & Haryana High Court in the case of Ambuja Cements (supra) and the judgment dated 18.05.2009 by the larger Bench of the tribunal, both having binding effect and, accordingly, he is entitled ..... X X X X Extracts X X X X X X X X Extracts X X X X
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