Waiver granted for pre-deposit of CENVAT Credit and penalty; recovery stayed pending appeal

The Tribunal granted a waiver of all dues adjudged and stayed the recovery during the pendency of the Appeal, based on the precedent set by the Delhi High Court in a similar case, allowing the Applicant's Application for waiver of pre-deposit of CENVAT Credit and penalty under Rule 15(2) of CCR, 2004 read with Section 11AC of the Central Excise Act, 1944.

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Issues: Application for waiver of pre-deposit of CENVAT Credit and penalty under Rule 15(2) of CCR, 2004 read with Section 11AC of Central Excise Act, 1944.

The judgment pertains to an Application seeking waiver of pre-deposit of CENVAT Credit and penalty amounting to Rs. 6.69 Crores imposed under Rule 15(2) of CCR, 2004 read with Section 11AC of the Central Excise Act, 1944. The Applicant had availed CENVAT Credit on input Full Hard CR Coil from a group company and discharged appropriate duty on the finished goods, which exceeded the CENVAT credit availed. The Revenue alleged that the process of galvanization did not result in manufacture as per Section 2(f) of the Central Excise Act, thus contending that the CENVAT Credit on the input was inadmissible. The Applicant relied on the judgment of the Delhi High Court in SRV Print Pack Pvt. Ltd. v. Commissioner of Central Excise, arguing that once duty on the final product is accepted by the Revenue, the CENVAT Credit on inputs cannot be denied. The Revenue reiterated the findings of the Commissioner, leading to the Tribunal's consideration of the issue.

The Tribunal noted that the issue at hand was covered by the judgment of the Delhi High Court in the SRV Print Packs case, where the Court allowed the petition without requiring a pre-deposit. Citing this precedent, the Tribunal opined that the Applicant had established a prima facie case for a total waiver of the dues adjudged. Consequently, the Tribunal granted a waiver of all dues adjudged and stayed the recovery during the pendency of the Appeal. The decision was based on the application of the precedent set by the Delhi High Court, which influenced the Tribunal's ruling in favor of the Applicant for the waiver of pre-deposit of CENVAT Credit and penalty.

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