Pre-deposit waiver for composite penalty follows where confiscated goods are not prima facie shown to be imported goods.

Pre-deposit of a composite penalty was waived where the confiscated goods were not prima facie shown to be imported goods, weakening the Customs Act basis for the levy. The Tribunal treated the penalty as a consolidated levy linked to both the Cenvat Credit Rules and Customs provisions, and noted that no separate penalty was shown under the Central Excise Rules alone. On that prima facie assessment, the Tribunal dispensed with pre-deposit and stayed recovery pending appeal.

---

---

Issues: Whether pre-deposit of the penalty was liable to be waived in a case where the confiscated goods were not shown to be imported goods and the penalty was imposed as a composite levy under the Central Excise Rules and the Customs Act.

Analysis: The application concerned a penalty imposed under the Cenvat Credit Rules read with the Customs Act. The confiscated goods had not been established to be imported goods, which was the basis for invoking penalty under the Customs Act. The order also reflected that there was no separate penalty under the Central Excise Rules alone, but only a consolidated penalty with reference to the Customs provisions. On this prima facie view, the Tribunal found a strong case for dispensing with pre-deposit pending appeal.

Conclusion: Pre-deposit of the penalty was waived and recovery was stayed pending the appeal, in favour of the appellant.

Ratio Decidendi: Where imported character of confiscated goods is not prima facie established and the penalty is a composite levy, pre-deposit of the penalty may be waived pending appeal.

---