Prima facie exemption for cement supplies to industrial consumers justified waiver of pre-deposit and stay of recovery.

Prima facie evidence that cement buyers were industrial consumers using the goods for self-consumption supported eligibility for the concessional exemption for cement cleared otherwise than in packaged form under Notification No. 4/2006-C.E., as amended. On that material, the assessee established a prima facie case for exemption and was granted waiver of pre-deposit with stay of recovery of duty, interest and penalty pending appeal before CESTAT.

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Issues: Whether the appellant was entitled to waiver of pre-deposit and stay of recovery of duty, interest and penalty pending appeal on the basis that the cement clearances were covered by the concessional exemption for supplies to industrial or institutional consumers.

Analysis: The exemption under Notification No. 4/2006-C.E., as amended by Notification No. 4/2007-C.E., applied to cement other than that cleared in packaged form, i.e. cement supplied to industrial or institutional consumers. The appellant produced certificates and sales tax registration documents showing that the purchasers were manufacturers of ready-mix concrete and that the cement was used for self-consumption, which supported the claim that the clearances were to industrial consumers. On this material, the appellant established a prima facie case for the exemption.

Conclusion: The appellant was entitled to waiver of pre-deposit and stay of recovery pending disposal of the appeal.

Final Conclusion: Interim relief was granted in favour of the appellant, and recovery of the disputed duty, interest and penalty remained stayed during the pendency of the appeal.

Ratio Decidendi: Where the assessee produces prima facie evidence that the buyers are industrial consumers and that the goods were used for self-consumption, pre-deposit and recovery may be waived pending appeal under the relevant exemption notification.

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