Prima facie exemption under excise notification justified waiver of pre-deposit and stay of recovery without upfront deposit.

A prima facie case for complete waiver of pre-deposit under Section 35F was found where the exemption under Notification No. 3/04-C.E. appeared applicable. The lower authority's denial of exemption was held, at the interim stage, not to accord with the notification, and the use of pipes beyond the first storage facility was treated as a relevant factor for exemption scrutiny. On that basis, the appellant established sufficient grounds for waiver of duty and penalty pre-deposit, and the impugned order was stayed without insisting on pre-deposit.

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Issues: Whether the appellant had made out a prima facie case for complete waiver of pre-deposit and stay of recovery under Section 35F of the Central Excise Act, 1944 in view of the exemption under Notification No. 3/04-C.E. dated 08.01.2004.

Analysis: The order records a prima facie view that the lower authority's denial of exemption was not in consonance with the notification, and that the pipes used beyond the first storage facility required consideration for exemption. On that basis, the appellant was found to have established a prima facie case warranting waiver of duty and penalty pre-deposit.

Outcome: The application for waiver of pre-deposit and stay was allowed, and the impugned order was stayed without insisting on pre-deposit.

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