Prima facie limitation and revenue neutrality justified unconditional waiver of pre-deposit in the interim stage.

Prima facie limitation and revenue neutrality were treated as sufficient grounds to waive pre-deposit. The Tribunal noted that extended limitation requires material showing mala fide suppression, and that a mere expectation of fuller disclosure under self-assessment is not enough; in the absence of such material, the limitation objection had prima facie force. It also accepted the revenue neutrality plea on a prima facie basis, relying on the duty position arising from the mode of clearance and exemption consequences, as well as an earlier majority view. Unconditional waiver of pre-deposit was therefore granted and the stay application was allowed.

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Issues: (i) whether the demand was prima facie barred by limitation so as to justify waiver of pre-deposit, and (ii) whether the plea of revenue neutrality supported waiver of pre-deposit.

Issue (i): whether the demand was prima facie barred by limitation so as to justify waiver of pre-deposit

Analysis: The demand was based on inclusion of the benefit arising from duty-free imports under advance licences as additional consideration. The order notes that the assessee had no prescribed ER-1 mechanism to disclose such particulars and that invocation of the extended period requires material showing mala fide suppression, not merely a general expectation of full disclosure under self-assessment. In the absence of such material, and in view of the cited Supreme Court guidance on limitation, the objection to limitation was found to have prima facie force.

Conclusion: The limitation objection was accepted prima facie in favour of the assessee.

Issue (ii): whether the plea of revenue neutrality supported waiver of pre-deposit

Analysis: The order records a prima facie acceptance of revenue neutrality, noting that the assessee relied on the duty position flowing from the manner of clearance and on exemption-related consequences. The Tribunal also referred to an earlier majority view supporting the assessee on revenue neutrality, and on that basis treated the demand as not warranting insistence on pre-deposit at the interim stage.

Conclusion: The revenue neutrality plea was accepted prima facie in favour of the assessee.

Final Conclusion: The assessee was granted unconditional waiver of pre-deposit and the stay application was allowed.

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