2013 (3) TMI 164 - AT - Central Excise

Tribunal grants stay petition, waives duty, interest, penalty for pressure booster system.

The Tribunal granted the stay petition, waiving the pre-deposit of duty, interest, and penalty amounting to Rs.68,44,267/-, as the pressure booster system ... Notification no. 10/2006-CE dated 01.03.2006 benefit denied - applicant seeking waiver of pre-deposit of duty, interest and penalty - applicants are engaged in the manufacture of power driven pumps - Held that:- Going through the provisions of the notification as well as the Central Excise Tariff classification. The applicants are claiming classification under Heading 84137010 which covers power driven pump primarily designed for handling water. As the classification is not disputed by the Revenue, therefore, prima facie the applicants have made out a strong case for waiver of pre-deposit of the dues. Pre-deposit of the dues is therefore waived and recovery thereof stayed for hearing of the appeal. Issues:1. Application for waiver of pre-deposit of duty, interest, and penalty.2. Denial of benefit of Notification no. 10/2006-CE.3. Classification of pressure booster system under sub-heading 84137010.4. Dispute over whether the product qualifies as power driven pumps.5. Revenue's contention regarding the input for manufacturing the pressure boosting system.6. Interpretation of the notification and Central Excise Tariff classification.Analysis:The judgment pertains to an application for waiver of pre-deposit of duty, interest, and penalty amounting to Rs.68,44,267/-, where the demand was confirmed by denying the benefit of Notification no. 10/2006-CE. The dispute revolved around the classification of a pressure booster system under sub-heading 84137010 of the Central Excise Tariff, with the key issue being whether the said system qualified as power driven pumps primarily designed for handling water. The applicants argued that the product in question, comprising centrifugal pumps and other components, fell within the ambit of the notification, as they were used for lifting water. The Revenue contended that the system was more than just power driven pumps and hence, the benefit was rightly denied.Upon examining the notification and Tariff classification, the Tribunal observed that the applicants classified the product under Heading 84137010, which covered power driven pumps primarily designed for handling water. Since the Revenue did not dispute this classification, the Tribunal found a strong case for waiver of pre-deposit dues. Consequently, the Tribunal granted the stay petition, waiving the pre-deposit of dues and staying the recovery pending the appeal hearing.In conclusion, the Tribunal's decision hinged on the interpretation of the notification and the Central Excise Tariff classification, ultimately favoring the applicant's contention that the pressure booster system qualified as power driven pumps primarily designed for handling water, warranting the waiver of pre-deposit of dues and a stay on recovery.