2013 (10) TMI 47 - AT - Central Excise

Tribunal grants waiver and stays recovery of dues for M/s. Standard Niwar Mills in excise case

STANDARD NIWAR MILLS Versus COMMISSIONER OF CENTRAL EXCISE, KANPUR

STANDARD NIWAR MILLS Versus COMMISSIONER OF CENTRAL EXCISE, KANPUR - 2013 (291) E.L.T. 409 (Tri. - Del.) Issues:Stay application seeking waiver of pre-deposit and stay of recovery of dues confirmed by Commissioner of Central Excise, Kanpur.Analysis:The case involves a stay application filed by M/s. Standard Niwar Mills seeking waiver of pre-deposit and stay of recovery of dues confirmed by the Commissioner of Central Excise, Kanpur. The applicants were clearing tents extendable made of cotton along with aluminium pipes, two way and three way joints, and other accessories, paying duty at 4% adv. classifying the product under Chapter Heading 63 of the Central Excise Tariff. The department contended that the benefit under Notification No. 29/2004 was not applicable as the tent extendable sold with accessories could not be treated as cotton tents. A Show Cause Notice was issued, resulting in a demand of Rs. 50,86,530/- along with interest and penalty. The applicant sought stay and waiver of pre-deposit against these dues.The appellant's advocate argued that a major portion of the demand was time-barred as the Show Cause Notice was issued after the relevant period. He also contended that the benefit under Notification 29/2004 should apply as no textile fiber other than cotton was used in manufacturing the tent extendable. Referring to a similar case, he highlighted that the Commissioner (Appeals) had granted the benefit of the notification to other assessees facing a similar issue, strengthening the case for waiver of pre-deposit.On the other hand, the Commissioner (Authorised Representative) for the Revenue argued that since aluminium and iron products were supplied with the tent extendable, the 4% duty rate benefit would not apply. He mentioned that the department had appealed against the order-in-appeal granting the benefit to other assessees, indicating that the matter was under dispute.After considering the arguments, the Tribunal found that the Notification No. 29/2004 exempts goods falling under specific chapters if they are made of cotton without any other textile material. The Tribunal noted that the explanation in the notification included items used for stitching, fastening, holding, or adornment, even if made from materials other than cotton. Given that the aluminium pipes and joints were used for holding the tents, the Tribunal observed that the benefit of the notification should apply. Additionally, the Tribunal highlighted a previous order-in-appeal by the Commissioner (Appeals) granting the benefit to other assessees, which had not been stayed by the Tribunal. Consequently, the Tribunal was inclined to grant waiver of pre-deposit and stayed the recovery of dues until the appeal's disposal.