Pre-deposit waiver and stay of recovery justified where no misdeclaration was found and extended limitation appeared unsupported.

Unconditional waiver of pre-deposit and stay of recovery were considered justified where the components had been cleared after examination of the operation manual, with no misdeclaration at clearance. The demand was supported by invocation of the extended limitation period, but the record suggested a possible change in departmental opinion rather than suppression of facts. The appellants also relied on an earlier Tribunal ruling in their own case, which had been stayed by the Apex Court and involved a split view. On these facts, a strong prima facie case was found for waiver pending appeal, and recovery was stayed until disposal of the appeal.

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Issues: Whether the appellants were entitled to unconditional waiver of pre-deposit and stay of recovery pending appeal, having regard to the earlier Tribunal ruling, the stay granted by the Apex Court, and the plea of time bar.

Analysis: The components had been cleared after examination of the operation manual and there was no misdeclaration at the stage of clearance. The demand was sought to be sustained by invoking the larger period, but the record disclosed a possible change of departmental opinion rather than suppression of facts. The earlier Tribunal ruling in the appellants' own case had also been stayed by the Apex Court, and there was a split opinion in that ruling. In these circumstances, a strong prima facie case was made out for waiver of pre-deposit.

Conclusion: The appellants were entitled to unconditional waiver of pre-deposit and stay of recovery till disposal of the appeal.

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