Prima facie no abetment of ineligible Cenvat credit justified waiver of pre-deposit and stay of penalty recovery.

On a prima facie assessment in stay proceedings, the tribunal found that a CHA had filed Bills of Entry on the importer's declaration, paid the customs duty, and cleared the goods, so the later direction on delivery did not at this stage amount to abetment of ineligible Cenvat credit. No final view was taken on penalty liability under Rule 26 of the Central Excise Rules, 2002. Waiver of pre-deposit was therefore granted and recovery of the penalty was stayed pending disposal of the appeal.

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Issues: Whether penalty imposed under Rule 26 of the Central Excise Rules, 2002 warranted waiver of pre-deposit in the stay proceedings, and whether recovery should remain stayed pending disposal of the appeal.

Analysis: The application was considered on a prima facie basis. It was found that the appellant, acting as a CHA, had filed Bills of Entry on the importer's declaration, discharged the applicable customs duty, and cleared the goods from the customs area. On those facts, the subsequent direction regarding delivery of the consignment did not amount, at this stage, to abetment of ineligible availment of Cenvat credit. No final adjudication on the penalty liability was made in this order.

Outcome: Waiver of pre-deposit was granted and recovery of the penalty was stayed till disposal of the appeal.

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