Prima facie compliance with exemption procedure and doubtful extended limitation supported complete waiver of pre-deposit and recovery stay.
Prima facie compliance with Notification No. 108/1995-C.E. procedures justified complete waiver of pre-deposit and stay of recovery. The record showed that the project authority certificate had been obtained and submitted, the department had acknowledged receipt, and clearances were made by invoice with reference to that communication. On those facts, the exemption procedure appeared to have been followed. The demand also rested on a doubtful invocation of the extended limitation period, particularly where the relevant facts were already within departmental knowledge. Supply to the contractor was not treated as fatal to the exemption claim at the interim stage.
Issues: Whether the appellants had made out a prima facie case for waiver of pre-deposit and stay of recovery on the ground that the demand appeared to be barred by limitation and that the procedure under Notification No. 108/1995-C.E. had been followed.
Analysis: The record showed that the project authority certificate had been obtained and submitted, the Assistant Commissioner had acknowledged receipt and directed further intimation to the Range Officer, and the clearances were made under invoice with reference to that communication. On these facts, the procedure prescribed by Notification No. 108/1995-C.E. appeared to have been complied with. The demand was also found to rest on a prima facie doubtful invocation of the extended period, especially when the relevant facts were already within the department's knowledge. The notification explanation further indicated that supply to the contractor was not, by itself, fatal to the exemption claim at this stage.
Conclusion: The appellants were held to have established a prima facie case for complete waiver of pre-deposit and stay of recovery pending appeal.
Final Conclusion: Interim protection was granted to the appellants, and the demand was not required to be secured during the pendency of the appeal.
Ratio Decidendi: Where the record shows prima facie compliance with the exemption notification procedure and the invocation of the extended period is doubtful on facts already known to the department, complete waiver of pre-deposit and stay of recovery may be granted.
TaxTMI 
AI Drafter ✕
TaxTMI 
