Waiver of predeposit for penalty was allowed where resignation predated the alleged removal period and a prima facie case existed.

Entitlement to waiver of predeposit and stay of recovery was considered in the context of a penalty imposed under Rule 209A of the Central Excise Rules, 1944. The appellant's assertion that he had resigned from the company before the period of alleged clandestine removal was not rebutted, and the demand period was subsequent to that resignation. The relevant Managing Director had already been exonerated by the lower appellate authority. On these facts, a prima facie case for interim relief was found, and waiver of predeposit was granted together with stay of recovery of the penalty during the appeal.

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Issues: Whether the appellant was entitled to waiver of predeposit of the penalty imposed under Rule 209A of the Central Excise Rules, 1944 and stay of recovery during pendency of the appeal.

Analysis: The appellant's plea that he had resigned from the company before the period of alleged clandestine removal was not rebutted. The period of demand was subsequent to the resignation, and the Managing Director for the relevant period had already been exonerated by the lower appellate authority. On these facts, a prima facie case was made out for grant of interim relief.

Conclusion: Waiver of predeposit was granted and recovery of the penalty was stayed during the pendency of the appeal.

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