Prima facie invalid show cause notice justified waiver of pre-deposit and stay pending appeal.

Where a duty demand is founded on a show cause notice issued by an authority lacking prima facie competence under the Section 11A regime, the Tribunal may treat the demand as vulnerable at the interim stage and grant protection against coercive recovery. On that basis, the pre-deposit requirement was waived and stay was granted pending disposal of the appeal.

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Issues: Whether the pre-deposit of the adjudged amount should be waived and stay granted on the ground that the show cause notice issued by the Deputy Collector was prima facie not maintainable under Section 11A.

Analysis: The facts as to the issuance of the show cause notice by the Deputy Collector, the period of demand, and the challenge based on Section 11A were undisputed. The Tribunal noted the earlier judicial view that notices issued by an authority other than the Collector in such circumstances were prima facie void, and treated the matter as an exceptional case warranting reconsideration of the earlier stay orders. In that prima facie setting, the Tribunal considered it just to modify the earlier order and grant interim protection.

Conclusion: The pre-deposit was waived and stay was granted in favour of the assessee.

Ratio Decidendi: Where a duty demand is supported by a show cause notice that is prima facie not maintainable for want of authority under the applicable Section 11A regime, the Tribunal may waive pre-deposit and grant stay pending disposal of the appeal.

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