Prima facie case and limitation in stay matters justify only partial waiver of pre-deposit

In a stay application, the Tribunal found no prima facie basis for complete waiver of pre-deposit because the appellants had not shown that the Commissioner's annual production capacity ination had been set aside. It also held that the limitation objection did not cover the entire demand, as the period from April 1998 to September 1998 fell within the six-month limit. Partial relief was therefore justified: the appellants were required to pre-deposit a reduced amount, while waiver and stay were granted for the balance duty and the entire penalty during the appeal.

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Issues: Whether, in the stay application, the appellants had made out a prima facie case for waiver of pre-deposit of the entire duty and penalty demand, and whether the demand for the relevant period was barred by limitation.

Analysis: The Tribunal found that the appellants had not, at the prima facie stage, established that the annual production capacity determined by the Commissioner had been set aside. It also noted that the demand relating to the period from April 1998 to September 1998 fell within the six-month period and that the limitation objection was not made out for the entire demand. On that basis, the Tribunal held that complete waiver of pre-deposit was not justified, but partial relief could be granted by requiring a deposit of a reduced amount while protecting the balance during the pendency of the appeal.

Conclusion: The application for complete waiver was declined in part, and the appellants were directed to pre-deposit Rs. 17 lakh, with waiver and stay granted for the remaining duty amount and the entire penalty.

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