Tribunal allows duty payment in instalments, permits CENVAT credit use, and waives predeposit on compliance.

The Tribunal directed the appellants to deposit the duty amount falling within the limitation period, allowed the utilization of CENVAT credit for payment, and waived the predeposit of the remaining amount upon compliance.

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Issues Involved: Determination of legal liability to pay cess under the Industries (Development & Regulation) Act, 1951 when dumpers are exempted from excise duty; Contention on limitation for payment of confirmed duty; Utilization of CENVAT credit for payment of cess.

Analysis:

1. Legal Liability for Cess: The appellants, engaged in manufacturing motor vehicles, including dumpers exempted from excise duty, raised the issue of whether a legal liability exists to pay cess under the Industries (Development & Regulation) Act, 1951, when dumpers are duty-exempt. The Tribunal acknowledged the previous Stay Order where the appellants were directed to deposit the confirmed duty amount. The advocate for the appellant conceded on the merits of the issue. However, the advocate contested the demand based on limitation, arguing that a portion of the demand was time-barred. The Tribunal recognized the contentious nature of the issue but directed the appellants to deposit the duty amount falling within the limitation period.

2. Limitation Contention: The advocate for the appellant contended that out of the total confirmed demand, a specific amount would be barred by limitation, while the remaining amount fell within the limitation period. The Tribunal agreed with the advocate's argument on limitation and directed the appellants to deposit the amount falling within the limitation period. The Tribunal also noted that since the activities were known to the Revenue, no suppression could be attributed to the appellants. The Tribunal further waived the predeposit of the balance amount of duty, interest, and penalty upon compliance with the directed deposit.

3. Utilization of CENVAT Credit: Regarding the utilization of CENVAT credit for payment of the duty, the Tribunal found merit in the contention that credit of excise duty could be used for the payment of cess as per the CENVAT Credit Rules, 2002 and 2004. The Tribunal accepted the advocate's request to allow the appellants to debit their CENVAT credit account for the payment of the duty amount falling within the limitation period. The Tribunal directed the appellants to make the deposit within four weeks and report compliance by a specified date, with the condition that upon deposit of the directed amount, the predeposit of the remaining duty, interest, and penalty would be waived.

In conclusion, the Tribunal resolved the issues by directing the appellants to deposit the duty amount falling within the limitation period, allowing the utilization of CENVAT credit for payment, and waiving the predeposit of the remaining amount upon compliance.

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