Pre-deposit waiver for customs and excise demands granted on prima facie case and severe financial hardship grounds.

Waiver of pre-deposit and stay of recovery may be granted where the appellant demonstrates a prima facie arguable case and severe financial hardship. The demand on capital goods was treated as prima facie covered by an earlier Tribunal decision relied on by the appellant, and the Debts Recovery Tribunal record showed that the unit had already been proceeded against by a bank with directions affecting its movable and immovable assets. On that basis, severe financial hardship was found to be established, and pre-deposit was waived with recovery stayed pending disposal of the appeal.

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Issues: Whether waiver of pre-deposit and stay of recovery of customs duty, excise duty and penalty was justified on the ground of a prima facie case and severe financial hardship.

Analysis: The demand on capital goods was treated as prima facie covered by the Tribunal's earlier decision relied on by the appellant. On the question of financial inability, the order of the Debts Recovery Tribunal showed that the unit had already been proceeded against by a bank and that directions had been issued affecting its immovable and movable assets. In these circumstances, the applicant was found to have established severe financial hardship warranting relief at the stay stage.

Conclusion: Waiver of pre-deposit was granted and recovery of the demanded amounts was stayed till disposal of the appeal.

Ratio Decidendi: Pre-deposit may be waived where the appellant shows a prima facie arguable case and severe financial hardship.

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