Prima facie classification of tea leaf cutting machines supported complete waiver of pre-deposit and recovery stay.

CTC tea processing machines were described in clearance documents as leaf cutting machines and had been classified under chapter heading 84388040, with that classification already accepted by the department. Supporting Chartered Engineer and consumer-body certificates indicated the machines were used only for cutting tea leaves, and there was no material showing suppression about their function. On that prima facie basis, the claimed classification and exemption under Notification No. 6/2006-C.E. were treated as sufficiently supported, justifying complete waiver of pre-deposit and stay of recovery pending appeal.

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Issues: Whether the applicants had made out a prima facie case for total waiver of pre-deposit and stay of recovery in a dispute concerning classification of CTC tea processing machines and the availability of exemption under Notification No. 6/2006-C.E. dated 1-3-2006.

Analysis: The machines were shown in the clearance documents as leaf cutting machines and were classified under chapter heading 84388040, a classification that had been consistently accepted by the department. The applicants supported their claim with Chartered Engineer's certificates and certificates from consumer bodies indicating that the machines were used only for cutting tea leaves. In the absence of material showing suppression regarding the function of the machines, and in view of the prima facie support for the claimed classification and exemption, the applicants established a strong case at the interim stage.

Conclusion: The applicants were entitled to complete waiver of pre-deposit and stay of recovery during pendency of the appeal.

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