Tribunal grants waiver of pre-deposit for appellant pending appeal.

The Tribunal found the appellant eligible for waiver of pre-deposit pending appeal, noting the reversal of credit for common input services and a prima facie case for waiver of duty and penalty. The Tribunal granted the waiver and stayed the recovery of duty and penalty until the appeal's disposal.

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Issues:
1. Whether separate accounts for input services are required under the Cenvat Credit Rules.
2. Applicability of waiver of pre-deposit of duty and penalty pending appeal.

Analysis:
1. The case involved a manufacturer of dutiable goods also producing exempted goods like zinc sulphate. The manufacturer used common inputs and input services for both types of goods but had not maintained separate accounts for input services. Show cause notices were issued, demanding duty and imposing penalties. The appellant argued that they had reversed the credit for non-permissible input services and sought waiver of pre-deposit pending appeal. The Department contended that without separate accounts, the appellant must pay 10% of the value of exempted goods cleared. The Tribunal noted the reversal of credit for common input services and found the appellant eligible for waiver of pre-deposit, pending further examination at the final hearing.

2. The appellant had reversed the credit for non-permissible input services and had paid a certain amount as directed by the Commissioner. The Department argued that subsequent adjustments did not comply with the Cenvat Credit Rules. The Tribunal observed that while separate accounts for common inputs are required, the rules are more lenient for common input services. The Tribunal held that the appellant had shown a prima facie case for waiver of pre-deposit of duty and penalty. Consequently, the Tribunal granted the waiver and stayed the recovery of duty and penalty until the appeal's disposal. The decision was dictated and pronounced in open court by the Tribunal.

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