Pre-deposit waiver and recovery stay granted where export policy benefits and Development Commissioner permission raised a prima facie legal issue.

Entitlement to exemption and clearance benefits was examined in the context of a demand for differential duty, interest and penalties, with the appellant relying on permission from the Development Commissioner and the applicable export policy. CESTAT considered that the effect of the permission granted under paragraph 9.9(e) and the manner of clearances raised a legal question requiring deeper examination, and found no prima facie reason to deny the claimed benefit at the interim stage. On that basis, the Tribunal held that a prima facie case had been made out for dispensation of pre-deposit and stayed recovery pending disposal of the appeal.

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Issues: Whether the appellant was entitled to waiver of pre-deposit and stay of recovery pending disposal of the appeal.

Analysis: The dispute arose from demand of differential duty, interest and penalties, with the appellant asserting entitlement to exemption and clearance benefits on the strength of permission granted by the Development Commissioner and the applicable export policy. The Tribunal found that the permission granted under paragraph 9.9(e) and the manner of clearances raised a legal question requiring deeper examination, and that there was no reason, prima facie, to deny the benefit at the interim stage. On this basis, the Tribunal considered that the appellant had made out a prima facie case for dispensation of pre-deposit.

Conclusion: The appellant was granted waiver of pre-deposit and recovery was stayed till disposal of the appeal.

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