Prima facie entitlement to exemption not shown, so only partial waiver of pre-deposit and stay of balance recovery was granted.

A stay application concerning entitlement to a concessional rate under an exemption notification was considered in a dispute over cement cleared to buyers claimed as institutional or industrial consumers. The Tribunal found that the appellant had not established a prima facie case that the buyers satisfied the Packaged Commodities Rules definition of institutional consumer, including direct purchase for use in a service industry. As the relevant notification and rules required interpretation and the claimed exemption was not shown at the stay stage, complete waiver of pre-deposit was declined. Partial relief was granted instead, with a deposit condition and stay of recovery of the remaining demand pending appeal.

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Issues: Whether the appellant had made out a prima facie case for complete waiver of pre-deposit and stay of recovery in a dispute concerning eligibility to the concessional rate under the notification.

Analysis: The appeal arose from a duty demand on cement cleared to various buyers claimed to be institutional or industrial consumers. The Tribunal noted that the appellant had not been able to show any precedent supporting its claim and that the definition of institutional consumer under the Packaged Commodities Rules required purchase directly for use in a service industry. On the material before it, the Tribunal found that the twin requirements for treating the buyers as institutional consumers were not established at the stay stage. Since the dispute involved interpretation of the notification and the rules, the Tribunal considered a partial pre-deposit appropriate.

Conclusion: The appellant was not granted full waiver of pre-deposit. It was directed to deposit Rs. 1 crore, and the balance duty and interest were stayed during pendency of the appeal.

Final Conclusion: Interim relief was granted only in part, with the appeal allowed to proceed subject to a pre-deposit condition and a consequential stay on recovery of the remaining demand.

Ratio Decidendi: In a stay application, where the applicant fails to establish a prima facie entitlement to the exemption claimed, the Tribunal may grant only partial waiver of pre-deposit and stay recovery of the balance pending appeal.

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