Pre-deposit waiver and recovery stay granted on a strong prima facie case under Rule 57D(1) for manufacturing waste and scrap.

Waiver of pre-deposit and stay of recovery were granted because the assessee showed a strong prima facie case under Rule 57D(1) of the Central Excise Rules, 1944. The Tribunal noted reliance on earlier decisions treating defective and damaged pieces arising in manufacture as waste and scrap, and found that those rulings supported the assessee's position. It also observed that the lower authorities had not dealt with all contentions and had not passed speaking orders. On that basis, recovery was stayed during the pendency of the appeal.

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Issues: Whether waiver of pre-deposit and stay of recovery were justified in view of the assessee's prima facie case under Rule 57D(1) of the Central Excise Rules, 1944.

Analysis: The order records that the assessee had raised several contentions, including reliance on prior Tribunal decisions dealing with defective and damaged pieces arising in manufacture as waste and scrap. It also notes that the lower authorities had not dealt with all the contentions and had not passed speaking orders. On prima facie consideration, the Tribunal found that the issue was covered by the cited ruling and by Rule 57D(1), and therefore the assessee had made out a strong prima facie case.

Conclusion: Waiver of pre-deposit was granted and recovery was stayed during the pendency of the appeal, in favour of the assessee.

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