Prima facie limitation and financial hardship justified waiver of pre-deposit in the stay proceedings.

At the stay stage, the Tribunal found a prima facie case that the demand was time-barred because the show cause notice was issued long after completion of the investigation, and it noted that the authority below had relied on a Larger Bench ruling later overruled by the Supreme Court. It also accepted the appellants' plea of financial hardship, taking into account the closure of the factory, rental occupation, and negative current assets, which showed inability to make a pre-deposit without undue hardship. On those grounds, interim relief was granted without any pre-deposit.

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Issues: (i) whether the demand, at the stage of stay, was prima facie hit by limitation in view of the period between completion of investigation and issue of the show cause notice; (ii) whether the appellants had shown sufficient financial hardship to justify waiver of pre-deposit.

Issue (i): whether the demand, at the stage of stay, was prima facie hit by limitation in view of the period between completion of investigation and issue of the show cause notice.

Analysis: The order noted that the authority below had relied on a Larger Bench decision that had already been overruled by the Supreme Court. It further noted that Tribunal decisions in similar matters had treated notices issued long after completion of investigation as time-barred, and distinguished the Supreme Court decision cited by the Revenue as dealing with a different context. On that basis, the appellants were found to have made out a prima facie case on limitation.

Conclusion: The limitation point was held prima facie in favour of the appellants.

Issue (ii): whether the appellants had shown sufficient financial hardship to justify waiver of pre-deposit.

Analysis: The order recorded that the factory had been closed for several years, was on rent, and that the net current assets were negative, showing inability to deposit any amount without undue hardship. Coupled with the prima facie merits on limitation, this justified grant of interim relief.

Conclusion: The financial hardship plea was accepted in favour of the appellants.

Final Conclusion: The stay petitions were granted without any pre-deposit, and the appeals were listed for final hearing.

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