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of <h1>Tribunal grants waiver & stay of recovery for duty & penalty, finding appellant eligible for exemption</h1> <h3>TEXMO INDUSTRIES Versus COMMISSIONER OF CENTRAL EXCISE, COIMBATORE</h3> TEXMO INDUSTRIES Versus COMMISSIONER OF CENTRAL EXCISE, COIMBATORE - 2005 (180) E.L.T. 319 (Tri. - Chennai) Issues:1. Waiver of pre-deposit and stay of recovery sought by the appellant regarding duty and penalty amounts.2. Classification of bushes manufactured by the assessee as bearings for excise duty purposes.3. Interpretation of Notification No. 5/98-C.E. and its predecessor regarding exemption eligibility.Analysis:1. The appellant sought waiver of pre-deposit and stay of recovery for duty and penalty amounts totaling Rs. 54,48,363/- each. The duty demand was related to PD pumps' bearings manufactured and consumed by the appellant in their factory during a specific period. The appellant argued that the bearings were actually bushes intended for pump operation in water bodies, thus eligible for exemption under Entry No. 265 of Notification No. 5/98-C.E. The appellant relied on a Tribunal decision and a Northern Bench stay order in support of their claim, while the SDR opposed the application.2. The Tribunal analyzed the case-law cited by the appellant, particularly referencing the WPIL Ltd. case where a similar entry to Entry No. 265 granted full exemption from duty to goods other than bearings. The Commissioner classified the appellant's bushes as bearings, denying them the exemption benefit. However, the Tribunal found the Commissioner's view inconsistent with the WPIL Ltd. case, which held guide bushes not classifiable as bearings and eligible for exemption. Consequently, the Tribunal granted waiver of pre-deposit and stay of recovery for the duty and penalty amounts, considering the appellant's strong prima facie case based on legal precedents.3. The judgment focused on the interpretation of Notification No. 5/98-C.E. and its predecessor regarding the eligibility for exemption from duty. The Tribunal emphasized the importance of correctly classifying the bushes manufactured by the appellant to determine their exemption status under the notification. By referencing legal precedents and the specific entry in the notification, the Tribunal concluded that the appellant's bushes should be considered distinct from bearings for excise duty purposes, thus qualifying for the exemption benefit. This interpretation aligned with the Tribunal's view in a previous case, reinforcing the appellant's entitlement to the exemption.
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