Prima facie limitation and sufficient prior deposit justified waiver of balance pre-deposit and stay of recovery pending appeal

A tribunal may waive balance pre-deposit and stay recovery pending appeal where the appellant has already deposited an amount meeting the statutory pre-deposit requirement and a prima facie limitation objection exists. Here, the Tribunal noted that the demand for the relevant period appeared time-barred and that the earlier deposit satisfied the pre-deposit condition for hearing the appeal. It therefore granted waiver of the remaining pre-deposit and stayed recovery of the outstanding duty, interest and penalty until disposal of the appeal.

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Issues: Whether the appellant was entitled to waiver of pre-deposit and stay of recovery during pendency of the appeal, having regard to the amount already deposited and the prima facie plea of limitation.

Analysis: The Tribunal noted that the matter required detailed examination at the stage of final hearing. It also recorded a prima facie view that the demand for the period from 10-9-2004 was hit by limitation. Since Rs. 10,00,000 had already been deposited in the earlier round, the Tribunal found that the statutory requirement for pre-deposit stood satisfied for the purpose of hearing the appeal.

Conclusion: Waiver of the balance pre-deposit was granted and recovery of the remaining duty, interest and penalty was stayed till disposal of the appeal, in favour of the assessee.

Ratio Decidendi: Where the Tribunal forms a prima facie view on limitation and the amount already deposited is sufficient to meet the statutory pre-deposit requirement, balance pre-deposit may be waived and recovery stayed pending appeal.

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