2012 (12) TMI 676 - AT - Central Excise

Tribunal Waives Pre-Deposit for Excise Duty on Motor Vehicles

Vectra Auto Components (P) Ltd. Versus Commissioner of Central Excise

Vectra Auto Components (P) Ltd. Versus Commissioner of Central Excise - TMI Issues:Application for waiver and stay of adjudged dues including excise duty on finished motor vehicles for the period from April 2006 to March 2007.Analysis:The appellant filed an application seeking waiver and stay in relation to the adjudged dues, which included an amount of Rs.17,25,662 demanded as excise duty on finished motor vehicles for a specific period. The appellant was involved in building bodies on chassis supplied by a company during the mentioned period. The company supplied the chassis after paying duty, and the appellant took CENVAT credit for such duty, then built bodies on the chassis and supplied the finished motor vehicles back to the company after paying duty. The demand on the appellant was based on the allegation that the company had undervalued the chassis, leading to undervaluation at the appellant's end. The records showed that proceedings were initiated against the company for recovery of duty on the grounds of undervaluation of chassis supplied to various body builders during the relevant period. The appellant argued that the demand should have been raised on the chassis suppliers, and the respondent failed to produce any adjudication order to prove undervaluation by the company.Upon reviewing the submissions, the tribunal found a prima facie case in favor of the appellant. The question of whether the chassis received by the appellant were undervalued by the company was still under adjudication at a different location. As such, the proceedings against the appellant were deemed prima facie unsustainable in law. Consequently, the tribunal granted waiver of pre-deposit and stay of recovery concerning the duty demanded from the appellant and the associated penalties.