Prima facie case on excisability secured waiver of predeposit and stay of recovery pending appeal.

A dispute over the excisability of an industrial water treatment plant was treated as highly debatable because the record raised competing versions on whether the plant was assembled and cleared in knocked-down condition from the factory or came into existence only at the customer's site with pipes, fittings, valves and civil foundation. On that prima facie basis, and noting that seized cash remained in departmental custody with no refund sought during the appeal, the Tribunal held that interim protection was justified. Waiver of predeposit of the balance adjudged dues was granted and recovery was stayed pending the appeals.

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Issues: Whether the applicants were entitled to waiver of predeposit and stay of recovery of the balance dues pending appeal in a dispute concerning the excisability of water treatment plants.

Analysis: The dispute involved whether the industrial water treatment plant was assembled in the factory and cleared in knocked down condition, or whether it came into existence only at the customer's site along with pipes, fittings, valves and civil foundation. The question was treated as highly debatable on the material before the Tribunal. The Tribunal also noted that Indian currency of Rs.38.76 lakhs seized during investigation remained in the Department's custody and that the applicants offered not to seek its refund during pendency of the appeal. On that basis, the Tribunal found the seized amount sufficient to secure hearing of the appeal and accepted the existence of a prima facie case for interim protection.

Conclusion: Waiver of predeposit of the balance adjudged dues was granted and recovery thereof was stayed during pendency of the appeals.

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