Prima facie exemption claim by vocational training institutes justified waiver of pre-deposit at the stay stage.

Where an assessee demonstrates a prima facie case that its activities fall within an exemption notification, pre-deposit may be waived at the interim stage. The Tribunal found prima facie merit in the applicants' claim that they were vocational training institutes covered by Notification No. 24/2004-S.T., and held that the exemption claim could not be rejected at the stay stage. On that basis, waiver of pre-deposit was granted and the stay petitions were allowed.

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Issues: Whether the applicants were entitled to waiver of pre-deposit in view of their claim that they were vocational training institutes covered by the exemption notification.

Analysis: The demands arose after denial of the exemption under Notification No. 24/2004-S.T. The applicants contended that they imparted vocational training and that, prior to the later amendment by Notification No. 19/2005-S.T., the notification extended exemption to vocational training institutes. The Tribunal found prima facie merit in the submission that the applicants were providing vocational training and that the claim to exemption could not be rejected at the stay stage.

Conclusion: Waiver of pre-deposit was granted and the stay petitions were allowed.

Ratio Decidendi: Where the assessee shows a prima facie case that its activities fall within the scope of an exemption notification, pre-deposit may be waived at the interim stage.

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