Waiver of pre-deposit granted on damaged export goods, with prima facie limitation and valuation issues undermining duty and penalty demands.

Waiver of pre-deposit was granted where the demand arose from damaged textile goods and made-up articles dealt with under export bond procedures. The applicants had informed the department about the damage, proposed sale and disposal basis, and the record showed that the goods were admittedly damaged and sold at the actual sale price. The Tribunal found prima facie force in the limitation plea and in the contention that the transaction value of the damaged goods did not sustain the confirmed duty demand. It also observed, prima facie, that the job-workers did not appear to bear a separate duty liability and that penalty was not justified at this stage.

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Issues: Whether the applicants were entitled to waiver of pre-deposit of the demanded duty and penalties pending disposal of the appeals.

Analysis: The applications arose from demands raised on damaged textile goods and made-up articles dealt with under export bond procedures. The applicants had informed the department about the damage, the proposed sale and the basis of disposal, and the record indicated that the goods were admittedly damaged and sold at the actual sale price. The Tribunal found prima facie force in the plea of limitation and in the contention that the transaction value of the damaged goods did not support the confirmed demand. It also noted, prima facie, that the job-workers did not appear to bear a separate liability for duty in the circumstances and that penalty burden was not justified at this stage.

Conclusion: Waiver of pre-deposit of the duty and penalties was granted.

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