Limitation challenge to tax demand justified unconditional waiver of pre-deposit and stay where extended period was not supported.

The demand was treated as prima facie time-barred because the Department had been aware of the taxable activity years before the show cause notice and no specific undisclosed primary facts were identified. On that basis, invocation of the extended period was not supported at the interim stage, and the demand appeared to be barred by limitation. The appellants were therefore granted unconditional waiver of pre-deposit and stay of recovery.

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Issues: Whether the demand was prima facie time-barred so as to justify full waiver of pre-deposit and stay of recovery.

Analysis: The Commissioner had recorded that the Department was aware of the appellants' taxable activity at least four years before the show cause notice. The order did not identify any specific primary facts that had not been disclosed. In those circumstances, the invocation of the extended period was not supported at this stage, and the demand appeared to be hit by limitation.

Conclusion: The appellants were entitled to unconditional waiver of pre-deposit and stay of recovery.

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