1. The Commissioner has demanded Rs. 1,13,562/- along with Education Cess from the assessee for the period Aug'05 to March'06, under Rule 14 of the Cenvat Credit Rules, 2004 read with Section 11A(1) of the Central Excise Act/Section 73 of Chapter V of the Finance Act, 1994. He has also raised a similar demand on the assessee for the period Jan'05 to July'05, amounting to Rs. 82,781/- + Education Cess. Penalties equal to the above demands have also been imposed on the assesse.
2. Moving the present application for waiver of pre-deposit and stay of recovery, Id. Counsel submits that the impugned order passed by the Commissioner under Section 84 of the Finance Act, 1994 is without jurisdiction inasmuch as the above demand is under Rule 14 of the Cenvat Credit Rules, 2004, which is not within the ambit of Chapter V of the Finance Act. Under Section 84 of the Finance Act, the Commissioner can revise any order of the subordinate officer, if that is an order passed under any of the provisions of Chapter V ibid. An order allowing Cenvat credit is not an order coming within the scope of Capter V of the Finance Act and hence it cannot be revised under Section 84 ibid.
3. Apart from this jurisdictional issue, Id. Counsel claims prima facie case against the above demand on merits as well. In this connection, it is pointed out that the South Zonal Bench (Bangalore) of the Tribunal has recognized outward transportation of final product from factory to buyer's premises is an input service for Cenvat credit purposes vide India Cements Ltd. v. CCE, Tirupati 2007 (8) S.T.R. 43 (Tribunal) : 2007 (216) E.L.T. 81 (Tri.-Bang.) wherein, after noting the contra view taken by a coordinate Bench in Gujarat Ambuja Cements 2007 (6) S.T.R.249 (Tribunal) : 2007.(212) E.L.T. 410 (Tribunal), the Bench referred the question to a Larger Bench.
4. According to Id. Counsel, in view of the reference of the issue to Larger Bench, the appellants are eligible for waiver of pre-deposit and stay of recovery. Opposing this plea, Id. JCDR submits that the above reference was made without taking into account the reasoned order of the South Zonal Bench (Chennai) on the same issue in the case of India Japan Lighting Pvt. Ltd. 2007 (8) S.T.R. 124 (Tribunal) : 2007 (218) E.L.T. 103 (Tri.-Chennai) and that the said decision needs to be followed by this Bench in the present case for the sake of judicial propriety and consistency. Contextually, Id. JCDR points out that this Bench has rightly followed India Japan Lighting (supra) in the case of IM Gears (P) Ltd. vide Stay Order No. 103/08 dated 1-2-08 and ordered pre-deposit.
5. Ld. Advocate, Shri S. Jaikumar, whose similar case is before this Bench, intervenes and submits that, in the case of India Cements Ltd. vide Stay Order No. 939/07 dated 17-9-07, the Division Bench granted waiver of pre-deposit and stay of recovery in respect of similar demand, after noting the above reference to Larger Bench.
6. After considering the submissions, I note that this Bench in Stay Order No. 103/08 dated 1-2-08 directed pre-deposit of a part of the amount of Cenvat credit denied by the revisional authority to M/s. IM Gears (P) Ltd., whereas the Division Bench granted waiver of pre-deposit and stay of recovery in respect of a similar demand raised on India Cements vide Stay Order No. 939/07 dated 17-9-07 ibid. It was without taking cognizance of the stay order of the Division Bench that this Bench passed Stay Order No. 103/08. As opined by ld. JCDR, I have got to take a view in the interest of judicial propriety and consistency. Accordingly, I follow the stay order passed by the Division Bench and grant waiver of pre-deposit and stay of recovery in respect of the duty and penalty amounts, after taking note of the reference to Larger Bench.
7. The jurisdictional issue raised by ld. Counsel in this case is of a substantial nature and the same, in my view, should be considered by the Division Bench. Accordingly, it is directed that the appeal be posted before the Division Bench as soon as its turn is reached before that Bench.