Pre-deposit waiver in customs classification dispute granted where identical issue was pending before a Larger Bench.

Discretion under Section 129E of the Customs Act, 1962 was exercised to grant full waiver of pre-deposit in a stay application concerning customs classification of imported coal and the resulting demand, interest and penalty. The order noted that identical classification disputes had produced divergent views across Benches and had already been referred to a Larger Bench. Relying on High Court authority that an arguable issue pending before a Larger Bench generally weighs against insisting on pre-deposit, and following an earlier stay order in similar matters, the assessee was granted complete waiver pending final hearing.

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Issues: (i) Whether the appellant was entitled to full waiver of pre-deposit in the stay application pending final hearing of the appeal.

Issue (i): Whether the appellant was entitled to full waiver of pre-deposit in the stay application pending final hearing of the appeal.

Analysis: The dispute concerned customs classification of imported coal and the consequent demand, interest and penalty. The order noted that identical issues had already led to divergent views among different Benches and that the matter had been referred to a Larger Bench. It further relied on High Court decisions holding that where a reference to a Larger Bench is pending and the issue is arguable, insistence on pre-deposit is not warranted and discretion should ordinarily be exercised in favour of waiver. The order also referred to the statutory discretion under Section 129E of the Customs Act, 1962 and followed its own earlier stay order granting similar relief in identical matters.

Conclusion: Full waiver of pre-deposit was granted in favour of the assessee.

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