Pre-deposit waiver in classification dispute denied on prima facie debatable classification, financial capacity, and extended period grounds.

In a classification dispute over Di Calcium Phosphate, Animal Feed Grade, waiver of pre-deposit was declined at the prima facie stage because the issue was considered highly debatable and the manufacturing process showed acidulation that could support classification under Chapter 28. The reliance on IS specification was not treated as sufficient for complete stay at this stage. Financial hardship was rejected because the balance sheet showed profit and available reserves. The objection to extended period invocation was also not accepted prima facie, as no material showed that the department had been informed of the manufacturing activity. The appellant was directed to deposit Rs.1,00,00,000 within eight weeks, and the balance demand was stayed on compliance pending disposal of the appeal.

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Issues: Whether waiver of pre-deposit and stay of recovery should be granted pending appeal in a classification dispute relating to Di Calcium Phosphate - Animal Feed Grade.

Analysis: The classification dispute was found to be highly debatable at the prima facie stage, with the manufacturing process indicating acidulation that could support classification under Chapter 28. The plea based on IS specification was not found sufficient for waiver at this stage. The appellant's plea of financial hardship was rejected on the basis of the balance sheet, which showed profit and available reserves. The plea against invocation of the extended period was also not accepted prima facie, as no material was produced to show that the department had been informed of the manufacturing activity.

Conclusion: The appellant was directed to deposit Rs.1,00,00,000 within eight weeks, and on compliance the balance demand was stayed till disposal of the appeal.

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