Prima facie case for exemption compliance led to waiver of pre-deposit and stay of duty recovery.

A strong prima facie case for waiver of pre-deposit arose where the applicants relied on an undisputed clarificatory order stating that the conditions of the exemption notifications had been complied with for duty-free import of raw materials under the DEEC Scheme, including discharge of export obligation. On that basis, the tribunal dispensed with pre-deposit and stayed recovery of duty and penalty pending final disposal of the appeal.

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Issues: Whether the applicants had made out a prima facie case for waiver of pre-deposit and stay of recovery of the duty demand and penalty pending disposal of the appeal.

Analysis: The applicants relied on a clarificatory order of the Joint Director General of Foreign Trade stating that the conditions of the relevant exemption notifications had been complied with in respect of the duty-free import of raw materials under the DEEC Scheme, including discharge of export obligation. The respondent did not dispute this clarification. In view of this undisputed position, the applicants were found to have a strong prima facie case.

Outcome: The requirement of pre-deposit was dispensed with and recovery of the duty and penalty was stayed till final disposal of the appeal.

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