Pre-deposit waiver in EOU excise dispute limited to steam demand, with balance relief and recovery stayed.

A CESTAT Mumbai order on pre-deposit in a 100% EOU dispute held that there was no prima facie case for full waiver where the third turbo generating set was used to generate electricity sold outside the unit and steam was cleared on payment of duty to another unit. On those admitted facts, the Tribunal found no merit in the contention that steam was non-excisable. Full waiver was declined, but the deposit requirement was confined to the demand relating to steam, and the balance pre-deposit was waived with recovery stayed during the pendency of the appeals.

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Issues: Whether the applicant was entitled to waiver of the entire pre-deposit in a case involving demand on steam used in the third turbo generating set and furnace oil used in generation of electricity sold outside the 100% EOU.

Analysis: The application was considered on the admitted position that the third turbo generating set was used for generation of electricity sold outside the 100% EOU and that steam was being cleared on payment of duty to another unit. On those facts, the Tribunal found no prima facie merit in the contention that steam was not excisable. At the same time, the order confined the required deposit to the demand relatable to steam and granted relief against the balance, with recovery stayed during pendency of the appeals.

Conclusion: Full waiver was declined. The applicant was directed to deposit Rs. 36,07,253/-, and on such deposit the remaining pre-deposit was waived and recovery stayed.

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