Re-import of exported excisable goods can justify stay relief when rules cover the goods and credit disallowance lacks reasons.

Re-imported exported excisable goods may qualify for interim relief where the applicable rules appear to cover reconditioning, refining, re-making or similar processes and the order offers no clear basis for disallowing credit. The note explains that bulk drugs were exported, later re-imported, further processed, and partly re-exported, yet no finding was recorded that the goods fell outside the relevant re-import rule. On that footing, a prima facie case was shown for waiver of pre-deposit and stay of recovery of duty and penalty pending appeal.

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Issues: Whether, in the facts of the case, the applicants had made out a prima facie case for waiver of pre-deposit and stay of recovery of the duty demand and penalty by relying on the rules governing rejected exports and re-import of exported excisable goods.

Analysis: The applicants had exported bulk drugs, later re-imported the goods, and carried out further processing before part of the quantity was re-exported. The order under challenge proceeded on the footing that the relevant rules covered the situation, yet the credit was disallowed without a clear reason. No finding was recorded that the goods were outside the scope of Rule 97B, which permits re-import of exported excisable goods for repair, reconditioning, refining, re-making, or similar processes. In these circumstances, the applicants showed a prima facie case for interim relief.

Conclusion: Waiver of pre-deposit was justified and recovery of duty and penalty was stayed pending the appeal, in favour of the assessee.

Ratio Decidendi: Where the applicable excise rules prima facie cover the re-imported goods and the impugned order gives no clear reason for disallowing credit, pre-deposit and recovery may be stayed pending appeal.

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