2014 (1) TMI 213 - AT - Central Excise

Tribunal allows appeal delay, denies SSI exemption, mandates pre-deposit for duty, stresses compliance

The Tribunal granted condonation of the delay in filing the appeal but denied the SSI exemption claimed by the appellant due to insufficient documentary ... Denial of SSI exemption under Notification No.8/2003 – Waiver of Pre-deposit – Held that;- Prima facie, the aggregate value of clearances taken by the authorities pertains to clearances of new egg trays manufactured by the SSI unit - the appellant’s claim for SSI benefit is not supported by any acceptable evidence and they are liable to pay the duty demanded – assessee directed to submit Rupees ten lakhs as pre-deposits – upon such submission rest of the duty to be stayed till the disposal – Partial stay granted. Issues:Delay in appeal, waiver and stay application, SSI exemption denial, documentary evidence scrutiny, financial hardships plea, pre-deposit directive.Delay in Appeal:The appellant filed two applications seeking condonation of the delay of the appeal and waiver and stay. The delay in filing the appeal was satisfactorily explained in the COD application, leading to the condonation of the delay by the Tribunal.SSI Exemption Denial:The impugned demand of duty amounting to Rs.11,70,317/- arose from the denial of SSI exemption claimed under Notification No.8/2003-CE. The appellant, engaged in the manufacture and sale of egg trays, claimed that second sales of used/old egg trays were also considered for determining the aggregate value of clearances, crossing the maximum limit prescribed in the notification. However, the original and first appellate authorities found documentary evidence against the appellant's claim. The verification report indicated that the appellant had paid sales tax at different rates for new and old egg trays, with some invoices showing sales of books/paper instead of old egg trays. The Tribunal observed a lack of acceptable evidence supporting the appellant's SSI benefit claim, leading to the liability to pay the duty demanded.Financial Hardships Plea:The appellant claimed financial losses in their business and requested not to make any pre-deposit. However, the Tribunal noted that the plea of financial hardships was not supported by any evidence in the stay application. The written submissions by the counsel contained the plea, but it was not present in the stay application. The lack of evidence supporting the financial hardships plea led the Tribunal to direct the appellant to pre-deposit a specified amount within a given timeframe.Pre-Deposit Directive:In view of the facts and circumstances of the case, the Tribunal directed the appellant to pre-deposit an amount of Rs.10,00,000/- within six weeks and report compliance to the Deputy Registrar. Subject to due compliance, there would be a waiver and stay in respect of the balance dues, including penalties. The directive aimed to ensure compliance with the pre-deposit requirement before granting any further relief to the appellant.This detailed analysis of the judgment covers the issues of delay in appeal, denial of SSI exemption, scrutiny of documentary evidence, financial hardships plea, and the pre-deposit directive issued by the Tribunal.