Stay of duty recovery pending appeal where Government departments had not finalised settlement on the disputed demand.

Recovery of a differential duty demand on IC engines was stayed pending appeal because the amount was said to involve inter-departmental Government funds and the concerned Ministries had not reached a final settlement. On those facts, coercive recovery was treated as unwarranted at that stage, and pre-deposit was effectively waived for interim protection. The Tribunal restrained realisation of the demand until final disposal of the appeal.

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Issues: Whether recovery of the duty demand under Section 11A should be stayed pending disposal of the appeal and pre-deposit waived.

Analysis: The demand related to differential duty on IC engines cleared during the relevant period. The recovery was sought to be deferred on the ground that the amount represented inter-departmental Government funds and that the Ministries concerned had not reached a final settlement. In these circumstances, coercive recovery was considered unwarranted at that stage.

Conclusion: Stay of recovery was granted and coercive steps for realisation of the amount were restrained until final disposal of the appeal.

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