Prima facie case justified waiver of pre-deposit and interim stay of recovery pending appeal.

A prima facie case supported waiver of pre-deposit where the appellant produced contracts and an affidavit showing a plausible link between the exported goods and the imported computer system. The demand had been confirmed on the basis that export obligations were not fulfilled and that the foreign exchange earned was not attributable to goods manufactured from the imported system, but the materials on record made that contention arguable. Pre-deposit was therefore not insisted upon, and coercive recovery was restrained until further orders, with the appeal fixed for early hearing to safeguard revenue interests.

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Issues: Whether the appellant was entitled to waiver of pre-deposit and interim protection pending appeal on the basis of a prima facie case.

Analysis: The appeal concerned a demand confirmed on the footing that export obligations were not fulfilled and that the foreign exchange earned was not attributable to goods manufactured from the imported computer system. The contracts and affidavit produced by the appellant indicated a correlation between the exported goods and the 2200 computer system, making the claim arguable. In these circumstances, pre-deposit was not insisted upon and coercive recovery was restrained till further orders, while the appeal was listed for early hearing to protect the revenue interest.

Conclusion: Pre-deposit was waived and recovery proceedings were stayed until further orders.

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