2013 (3) TMI 603 - AT - Central Excise

Waiver of pre deposit - denial of the benefit of SSI exemption under Notification No. 8/2003-C.E. dated 1-3-2003 - labels are printed with the name of others - Held that - Notification No. 28/2011-C.E. whereby an Explanation was added to the SSI Notification No. 8/2003 that for the removal doubts it is hereby clarified that packing material includes labels of all kinds. Hence prima facie the applicant has made out a case for total waiver of the pre-deposit of the dues. - Stay granted.

Summary

Issues:
- Application for waiver of pre-deposit of duty, interest, and penalty based on the interpretation of Notification No. 8/2003-C.E.
- Claim of entitlement for exemption under Notification No. 8/2003-C.E. due to the clarification added in Notification No. 28/2011-C.E.
- Dispute regarding the prospective nature of the clarification added in Notification No. 28/2011-C.E.

Analysis:
The judgment involves an application for the waiver of pre-deposit of duty, interest, and penalty by an entity engaged in the manufacture of printed cartons and labels. The dispute arises from the denial of the benefit of Small Scale Industry (SSI) exemption under Notification No. 8/2003-C.E. on the grounds that the labels are printed with the name of others, making them branded and ineligible for the exemption. The applicant relies on the clarification added in Notification No. 28/2011, which states that "packing material" includes labels of all kinds. The Revenue argues that this clarification is prospective in nature, while the demand in the present case is prior to the amendment.

The Tribunal observes that the clarification added in Notification No. 28/2011 explicitly includes labels as packing material, potentially entitling the applicant to the benefit of the exemption under Notification No. 8/2003-C.E. The Tribunal finds that the applicant has prima facie made a case for the total waiver of the pre-deposit of dues. Consequently, the Tribunal allows the stay petition, waives the pre-deposit of dues, and stays the recovery for the duration of the appeal hearing. This decision is based on the interpretation of the relevant notifications and the applicant's argument regarding their entitlement to the exemption based on the clarification provided in the subsequent notification.

In conclusion, the judgment highlights the significance of clarifications added to notifications and their impact on the entitlement to exemptions. The Tribunal's decision to grant a waiver of pre-deposit and stay recovery is based on the interpretation of the notifications in question, emphasizing the importance of legal provisions and their application in resolving disputes related to duty exemptions and liabilities in the context of manufacturing activities.