Prima facie tariff classification dispute supported complete waiver of pre-deposit and stay where only sub-assemblies were manufactured.

The appellants showed a strong prima facie case for complete waiver of pre-deposit and stay of recovery because they manufactured only sub-assemblies for car air-conditioners, not complete air-conditioners. The authority noted that the adjudicating authority had not applied Rule 2(a) of the Interpretative Rules to treat the sub-assemblies as complete air-conditioners, and that earlier tribunal decisions supported the view that a sub-assembly may fall within the expression "part" for tariff purposes. On that material, complete waiver of the demanded duty and penalty deposit was justified pending appeal.

---

---

Issues: Whether the appellants had made out a prima facie case for complete waiver of pre-deposit and stay of recovery of the demanded duty and penalty.

Analysis: The appellants were manufacturing only sub-assemblies for car air-conditioners and not complete air-conditioners. The authority noted that the adjudicating authority had not applied Rule 2(a) of the Interpretative Rules to treat the sub-assemblies as complete air-conditioners. It was also considered that the appellants had relied on earlier tribunal decisions supporting the view that a sub-assembly may fall within the expression 'part' for tariff purposes, and that the material placed showed a strong prima facie case.

Conclusion: The appellants were entitled to waiver of the entire pre-deposit and stay of recovery during the pendency of the appeal.

Ratio Decidendi: Where the assessee shows that it manufactures only sub-assemblies and not the complete goods, and the classification dispute is supported by substantial prima facie material, complete waiver of pre-deposit and stay of recovery may be granted.

---