Cenvat credit dispute over steel items used in construction warranted stay of recovery and waiver of pre-deposit pending Larger Bench review.

Prima facie conflict on Cenvat credit admissibility for steel items used in construction, including whether such goods qualify as capital goods or inputs, justified interim protection. The Tribunal noted contrary views on similar items, and that one issue was already before a Larger Bench while another had been prima facie considered in favour of the appellant in its own case. On that basis, pre-deposit of duty and penalty was dispensed with and recovery was stayed pending final resolution of the credit controversy.

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Issues: Whether, in the circumstances of the case, pre-deposit of duty and penalty should be dispensed with and recovery stayed pending reference of the credit entitlement controversy to a Larger Bench.

Analysis: The order records a prima facie view that steel items such as angles, joists, beams, channels, bars and flats used in construction work and in structures permanently embedded to the earth may not qualify as capital goods or inputs for the purpose of Cenvat credit. At the same time, the order notes a contrary Tribunal view in another matter on similar items, and observes that one of the issues was already before a Larger Bench while another issue had been prima facie considered in favour of the appellant in its own case. In that background, the case was treated as fit for interim protection.

Conclusion: Pre-deposit of duty and penalty was dispensed with and recovery was stayed in favour of the appellant.

Final Conclusion: Interim relief was granted pending decision by the Larger Bench, and the appellant was protected from immediate recovery of the disputed dues.

Ratio Decidendi: Where the dispute on admissibility of credit presents a substantial prima facie case and is already the subject of conflicting Tribunal views or Larger Bench reference, interim dispensation of pre-deposit and stay of recovery may be granted.

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