P.K.Jain, J. - (1.) The petitioner M/s Frontier Springs Limited has filed the present writ petition for the following relief : "(i) Issue a writ of Certiorari quashing the interim order dated 26.4.99 served on 22.5.99 passed by the Commissioner of Central Excise (Appeals), Allahabad on the stay-cum-waiver application; (ii) Issue any other writ, order or direction in the nature of mandamus directing the Commissioner (Appeals) to decide the stay-cum-waiver application within a stipulated period without insisting on pre-deposit of 50% of the adjudged dues and further directing the respondents not to recover the adjudged dues during the pendency of the appeal."
(2.) In the writ petition the petitioner has alleged that he is engaged in the manufacturer of leaf springs & coil springs falling under Chapter 73 of the Central Excise Tariff Act, 1985. The petitioner was using Flat bars as inputs in the manufacture of his final products and was availing the facility of Modvat. In terms of Rule 57-F(1) the inputs in which credit has been taken may be used in or in relation to the manufacture of final products. The inputs may also be removed after intimating the Assistant Commissioner of Central Excise concerned in writing for home consumption or for export. It further provides that all removals of inputs for home consumption shall be made on payment of duty equal to the amount of credit availed in respect of such inputs and shall be under the cover of invoice prescribed under Rule 52-A. The petitioner vide letter dated 10th January, 1990 sought general permission under Rule 57F (i) & (ii) to remove inputs after payment of duty from the Jurisdictional Superintendent Central Excise Kanpur and the same was granted vide order dated 11-1-1990. However, a notice of demand-cum-show cause dated 2-5-1996 was served upon the petitioner on the ground that on scrutinizing the petitioner's R.T. 12 return pertaining to the Month of October, 1995 it was found that he had cleared 136.266 metric tonne of Flat bars on payment of duty of Excise amounting to Rs. 449680/- to his Unit No. 2 at Rania Kanpur Dehat. The petitioner was required to showcause before the Deputy Commissioner (Judicial) Central Excise Kanpur as to why Modvat Credit of Rs. 4,49,680/utilized wrongly be not recovered from him as per Rule 57-F(i) & (ii) of the Central Excise Rules, 1944. In this case, the petitioner has removed his products at intermediate stage instead of input stage, hence he has contravened the provisions of Rule 57-F (i) & (ii). The petitioner in his show cause stated that shearing of Flat bars into smaller sizes does not amount to manufacture. The nature of Flat bars is not changed. Hence, it can not be said that the same were removed at intermediate stage. The same were removed admittedly after payment of appropriate Central Excise duty. Hence all objections raised through show cause notice were insignificant. The Flat bar is not final products of the petitioner. The Assistant Commissioner vide order dated 30-3-1998 adjudicated the case and confirmed the demand of Rs. 4,49,680/- and further imposed penalty of Rs. 1,50,000/- under the wrong impression that permission to clear inputs as such was granted for a specific case and not in general. Feeling aggrieved the petitioner has filed appeal before the Commissioner (Appeals) along with the Stay-cum-Waiver application. The Commissioner (Appeals) decided the Stay-cum-waiver application vide order dated 26-4-1999 served upon the petitioner on 22-5-1999 without considering the financial position of the petitioner correctly. The petitioner in support of his poor financial health had produced copy of the balance sheet at the time of hearing. The general permission for removal of inputs was also annexed along with the memo of appeal and the Commissioner (Appeals) ought to have examined the same before passing the impugned order. The order is bad because the Commissioner (Appeals) has neither considered the prima facie case on merits and nor the financial position correctly.
(3.) Copy of the impugned order is Annexure-5 whereby the stay application was rejected and the petitioner was directed to deposit 50% of the penalty imposed by the authority below.;