Prima facie case for interim relief secured waiver of pre-deposit and stay of penalty recovery in export dispute.

CESTAT Ahmedabad considered whether appellants were entitled to waiver of pre-deposit of penalties and stay of recovery pending appeal. The Tribunal noted that, although the adjudicating authority treated the export as prohibited basmati rice, the appellants claimed benefit under the relevant DGFT notifications. It observed that the goods appeared to fall within the restriction or clarification reflected in those notifications, supported by the Chief Chemist's report, and that a coordinate Bench had already covered the issue. On that basis, the Tribunal found a prima facie case for interim relief and allowed waiver of pre-deposit, staying recovery of the penalties until disposal of the appeals.

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Issues: Whether the appellants were entitled to waiver of pre-deposit of the penalties imposed and stay of recovery pending disposal of the appeals.

Analysis: The Tribunal noted that the adjudicating authority had proceeded on the basis that the export was of prohibited basmati rice, but found at the stay stage that the appellants had claimed benefit under the relevant DGFT notifications. It further observed that the goods appeared to fall within the restriction or clarification indicated in those notifications, as supported by the Chief Chemist's report, and that the issue was covered by a coordinate Bench decision. On that basis, the appellants were held to have made out a prima facie case for interim relief.

Conclusion: The applications for waiver of pre-deposit of the penalties were allowed and recovery of the penalties was stayed till disposal of the appeals.

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