Predeposit relief in duty demand dispute over retail packing loss, with recovery stayed after partial deposit.

Partial waiver of predeposit and stay of recovery were granted in a duty demand case arising from alleged shortage or loss during retail packing. The tribunal noted that some loss during retail packing was inevitable, but the year-wise variation in loss percentages raised a prima facie doubt, including a higher loss in the last year. The limitation objection was not finally decided and was left for detailed consideration at the appeal hearing. The applicant was directed to deposit Rs. 4,00,000 within eight weeks, and on that deposit the balance duty, interest and penalty were waived and recovery stayed pending disposal of the appeal.

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Issues: Whether the applicant was entitled to waiver of predeposit and stay of recovery pending appeal in a duty demand case arising from alleged shortage/loss during retail packing.

Analysis: The application concerned duty, interest and penalty demanded on the basis of year-wise variation in loss between material issued for production and finished goods. The loss during retail packing was recognised as inevitable, but the record showed inconsistent percentages of loss across the relevant years, with a prima facie higher loss in the last year. The objection based on limitation was not decided finally at this stage and was left for detailed consideration at the appeal hearing. In these circumstances, only partial relief was considered appropriate.

Conclusion: The applicant was directed to predeposit Rs. 4,00,000 within eight weeks, and on such deposit the balance duty, interest and penalty were waived and recovery stayed till disposal of the appeal.

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