Pre-deposit waiver does not equal stay of recovery, but limited interim protection may be granted to approach the Tribunal.

An order dispensing with pre-deposit of duty does not, by itself, operate as a stay on recovery of the balance demand. Where an assessee may have proceeded on a bona fide understanding that the waiver order afforded interim protection, limited protection can be granted to preserve the status quo while the assessee approaches the Tribunal for stay. In this instance, recovery was kept in abeyance for two months, and the respondents were directed not to enforce the demand during that period, enabling the petitioner to seek appropriate interim relief before the Tribunal.

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Issues: Whether an order dispensing with pre-deposit of duty also operates as a stay of recovery of the balance demand, and what interim protection should be granted pending the appeal before the Tribunal.

Analysis: The earlier view taken by the Court was that waiver of deposit does not amount to stay of collection of the duty payable. At the same time, where the assessee acted under a bona fide belief that the waiver order also protected against recovery, limited time was granted to approach the Tribunal for stay, with collection kept in abeyance for that period.

Outcome: The Court directed the respondents not to enforce the demand for two months, enabling the petitioner to move the Tribunal for appropriate stay orders.

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