Cenvat credit lapse and non-utilisation can justify waiver of pre-deposit and stay of recovery in interim proceedings.

Where Cenvat credit relating to inputs used in work-in-progress had already lapsed under Rule 9 and had not been taken or utilised, a direction to reverse the credit or deposit equivalent duty was treated as not warranted for interim relief. The cited prior appellate order on the same point, in which the Revenue's appeal had been dismissed, also supported the grant of stay. Waiver of pre-deposit and stay of recovery were therefore granted.

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Issues: Whether waiver of pre-deposit and stay of recovery should be granted where Cenvat credit in respect of work-in-progress was stated to have lapsed under Rule 9 of the Cenvat Credit Rules and had not been utilised.

Analysis: The order records that the credit in respect of inputs used in work-in-progress had already lapsed under Rule 9 and had not been taken or utilised by the appellant. On that basis, the demand to reverse the credit or deposit the equivalent duty was treated as not arising. The existence of a prior appellate order on the same point, dismissing the Revenue's appeal, also supported the request for interim relief.

Conclusion: Waiver of pre-deposit and stay of recovery were granted in favour of the appellant.

Ratio Decidendi: Where Cenvat credit has lapsed and has not been taken or utilised, a direction for reversal or pre-deposit of the equivalent duty is not warranted for purposes of interim stay.

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