2006 (1) TMI 360 - AT - Central Excise

Tribunal Waives Pre-Deposit & Stays Recovery for Duty and Penalty

The Tribunal granted waiver of pre-deposit and stayed recovery pending appeal for duty and penalty amounts confirmed against the applicants by the ... Stay/Dispensation of pre-deposit - Demand and penalty Issues:Waiver of pre-deposit of duty and penalty confirmed against the applicants on clearances during a specific period.Analysis:The judgment pertains to an application for waiver of pre-deposit of duty and penalty amounting to Rs. 1,65,46,146/- each, confirmed against the applicants by the Commissioner of Central Excise, Vapi, for clearances made between 1-1-2002 to 31-5-2004. The duty demand was upheld on the basis that the items cleared were complete Air Conditioners and not parts entitled to exemption from Special Excise Duty under Notification No. 22/2000-C.E., dated 6-3-2000.Upon hearing both sides, the Tribunal found a prima facie case for waiver. The invoices attached to the show cause notice indicated the clearance of specific parts like Electric Fan Motor with capacitor, Outdoor condensing unit with sheet metal parts, and Coil set with header. Reference was made to a CBEC circular dated 25-9-2002, which outlined the essential elements that must be present in an air conditioner assembly to qualify as such. The Adjudicating Authority's order was critiqued for not explicitly confirming the presence of all six essential elements required for an air conditioner, as per the CBEC circular.Consequently, the Tribunal granted the waiver of pre-deposit and stayed the recovery pending the appeal. This decision was influenced by a previous stay order issued by the Tribunal in a related case. The appeals were consolidated for a final hearing in due course, ensuring a comprehensive review of the matter.