Pre-deposit in exemption disputes turns on prima facie merits; later amending notifications do not extend earlier exemption retrospectively.

Interim relief under section 35F of the Central Excise Act depended on prima facie merits and the facts of the case. In a dispute over duty demand arising from denial of exemption under Notification No. 64/95-C.E., the Tribunal noted that a later amending notification introduced a specific entry for direct or indirect supplies to the Indian Navy and Coast Guard, indicating that indirect supply through another oil company's pipeline was not covered by the earlier exemption. Earlier stay and High Court orders were distinguished on their own facts, and no retrospective operation of the amending notification was shown. Waiver of pre-deposit was refused.

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Issues: Whether waiver of pre-deposit and stay of recovery should be granted under section 35F of the Central Excise Act, 1944 in respect of duty demand arising from denial of exemption under Notification No. 64/95-C.E. dated 16-3-95, in the context of the amending Notification No. 37/07 dated 1-11-2007.

Analysis: The application was considered on the basis of the rival stay orders and the High Court orders cited by the parties. A prior stay order in the appellant's own matter had directed a substantial pre-deposit, and there was no stay of that order. The earlier High Court orders were distinguished because they were passed on their own facts and did not decide the substantive exemption issue involved here. The amending notification introduced a specific entry covering direct or indirect supplies to the Indian Navy and Coast Guard, which indicated that indirect supply through another oil company's pipeline was not covered by the original notification. No retrospective operation of the amending notification was shown.

Conclusion: Waiver of pre-deposit was not granted, and the appellant was directed to deposit Rs. 1.00 crore as a condition for interim relief.

Ratio Decidendi: Interim relief under section 35F depends on the prima facie merits and the facts of the particular case, and a later amending exemption entry cannot be treated as retrospectively enlarging the scope of an earlier notification unless such retrospectivity is shown.

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