Acquittal in connected criminal proceedings can justify waiver of pre-deposit and stay of customs penalty recovery.

Acquittal in connected criminal proceedings may support a prima facie case for interim protection against customs penalty recovery. In this CESTAT note, proceedings under Section 114(i) of the Customs Act, 1962 were considered at the stay stage, and the applicants relied on the Special Judge's acquittal for the relevant customs offences. That acquittal was treated as sufficient basis to waive pre-deposit of penalty and stay recovery pending disposal of the appeals.

---

---

Issues: Whether waiver of pre-deposit of penalty and stay of recovery should be granted in view of the applicants' acquittal in the connected criminal proceedings.

Analysis: The applicants were proceeded against for penalty under Section 114(i) of the Customs Act, 1962. The order notes that the Special Judge had recorded an acquittal in respect of the relevant customs offences, and this circumstance was treated as supporting a prima facie case for interim relief. On that basis, the Tribunal held that the penalty proceedings warranted waiver of pre-deposit at the stay stage.

Conclusion: Waiver of pre-deposit was granted and recovery of the penalty was stayed until disposal of the appeals.

Ratio Decidendi: At the stage of waiver of pre-deposit, an acquittal in the connected criminal case may constitute a sufficient prima facie basis for granting interim protection against recovery of customs penalty.

---