Prima facie absence of penalty liability justified waiver of pre-deposit and stay of recovery pending appeal.

The Tribunal granted waiver of pre-deposit and stayed recovery of the penalty pending appeal because the record showed no prima facie basis to fasten penalty on the applicant. Although the show cause notice alleged three charges, the adjudicating authority had found no evidence of mis-declaration of quantity or value and sustained only the allegation concerning non-receipt of foreign exchange remittance. The Tribunal noted that the applicant was not shown to be connected with the remittance issue, and therefore recovery was stayed while the appeal remained pending.

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Issues: Whether the applicant was entitled to waiver of pre-deposit of the penalty and stay of recovery pending appeal.

Analysis: The Tribunal noted that the show cause notice had proceeded on three charges, but the adjudicating authority had found no evidence to establish mis-declaration of quantity and value and had sustained only the charge relating to non-receipt of foreign exchange remittance. On that basis, the Tribunal found that there was no prima facie basis to fasten penalty on the applicant, who was not shown to be connected with the remittance issue.

Outcome: Waiver of pre-deposit was granted and recovery of the penalty was stayed pending appeal.

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