Pre-deposit and interim stay must consider separate accounts under Cenvat credit rules before refusing relief.

A pre-deposit and interim stay order under Section 35F of the Central Excise Act was set aside because the appellate authority did not consider the appellant's pleaded case that separate accounts were maintained for inputs used in different products under Rule 6(3)(b) of the Cenvat Credit Rules, 2002. The record included correspondence supporting that contention, making it a relevant factor in assessing prima facie case and interim relief. The stay applications were directed to be reheard on the existing material and decided expeditiously.

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Issues: Whether the order on pre-deposit and interim stay under Section 35F of the Central Excise Act, 1944 required interference for not considering the appellant's stand that separate accounts were maintained under Rule 6(3)(b) of the Cenvat Credit Rules, 2002.

Analysis: The impugned order proceeded on the question of pre-deposit by recording only that no prima facie case was made out, but it did not examine the appellant's pleaded contention, supported by correspondence on record, that separate accounts had been maintained for inputs used in different products. Once the stay application was being decided on merits, that contention was a relevant factor for assessing the need for pre-deposit and interim relief. The matter therefore required reconsideration on the material already placed before the appellate authority.

Conclusion: The order was set aside and the stay applications were directed to be heard afresh and decided expeditiously.

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