CENVAT credit dispute over processed Silico Manganese: prima facie case justified waiver of pre-deposit and stay of recovery.

Interim relief was granted in a CENVAT credit dispute over Silico Manganese subjected to grinding, sizing and packing, because the appellant showed a prima facie case based on similar precedent and the fact that the resultant goods had been cleared on payment of duty accepted by the department. Waiver of pre-deposit of duty and penalty was therefore allowed, and recovery was stayed pending appeal.

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Issues: Whether the appellant had made out a prima facie case for waiver of pre-deposit and stay of recovery in a dispute concerning admissibility of CENVAT credit on Silico Manganese subjected to grinding, sizing and packing.

Analysis: The appellant received unfinished Silico Manganese, carried out grinding, sizing and packing, and cleared the resultant goods on payment of duty accepted by the department. In similar circumstances, judicial precedent had granted relief, and the appellant therefore established a prima facie case for interim protection pending appeal.

Conclusion: Waiver of pre-deposit of duty and penalty was granted and recovery was stayed during pendency of the appeal.

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