Prima facie CENVAT credit dispute justified waiver of pre-deposit and stay of recovery pending appeal.

At the prima facie stage, the applicant was granted waiver of pre-deposit and stay of recovery pending appeal because the dispute on the applicable excise rules and CENVAT credit required full examination at the hearing. On that interim assessment, the balance of convenience favoured protection from recovery, so the entire pre-deposit was waived and recovery remained stayed during the pendency of the appeal.

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Issues: Whether, at the prima facie stage, the applicant was entitled to waiver of pre-deposit and stay of recovery pending disposal of the appeal.

Analysis: The dispute involved interpretation of the applicable excise rules and the rival contentions on CENVAT credit. The merits were found to require examination at the hearing of the appeal. On the prima facie assessment, and having regard to the issues involved, the balance of convenience justified interim protection.

Conclusion: The entire pre-deposit was waived and recovery was stayed during the pendency of the appeal.

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