Limitation challenge supported waiver of pre-deposit and stay of recovery where the demand appeared time-barred.

A strong prima facie case for waiver of pre-deposit may arise where the demand appears time-barred on the admitted chronology. Here, credit was availed in 2004 and the show cause notice was issued in 2010, so the demand appeared to be raised beyond the normal limitation period. On that basis, the appellant was found to have a strong interim case on limitation, and waiver of pre-deposit was granted together with stay of recovery of the disputed amounts pending appeal.

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Issues: Whether the appellant made out a prima facie case for waiver of pre-deposit and stay of recovery on the ground that the demand was barred by limitation.

Analysis: The credit had been availed in 2004, whereas the show cause notice was issued in 2010. On that chronology, the demand appeared to be raised after the normal period, and the appellant was found to have a strong prima facie case on limitation at the interim stage.

Outcome: Waiver of pre-deposit was granted and recovery of the amounts in dispute was stayed during pendency of the appeal.

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