Kar Vivad Samadhan Scheme interim relief permitted provisional payment to preserve scheme benefit and stay demand pending hearing.

Pending final hearing, the Calcutta HC, on a prima facie basis, permitted the writ petitioner to tender 50% of the disputed duty and directed that, if paid within time, it be accepted without demur and treated as payment under the Kar Vivad Samadhan Scheme under section 90(2). The Court indicated that it could make a provisional intervention under section 90(1) for interim purposes, while leaving the ultimate questions of maintainability and scheme coverage to final hearing. The relief was granted to preserve the petitioner's ability to obtain the scheme benefit and carried a consequential stay of the impugned demand and bank guarantees subject to compliance.

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Issues: Whether, pending final hearing, the writ petitioner could be permitted to tender 50% of the duty demanded and have such payment treated as payment under the Kar Vivad Samadhan Scheme, with consequential stay of the impugned demand and bank guarantees.

Analysis: The order proceeds on a prima facie basis that the Court could, for interim purposes, substitute its own provisional adjudication under section 90(1) even though the designated authority had not yet acted. The Court noted that the demand dated 31-3-1998 might fall within the scheme provisions, but left the ultimate question of maintainability and coverage to final hearing. To protect the petitioner from losing the benefit of the scheme by lapse of time, the Court permitted payment of 50% within the stipulated time and directed that, if tendered, the amount be accepted without demur and treated as payment under section 90(2), all without prejudice to the writ.

Conclusion: Interim relief was granted in favour of the writ petitioner, with liberty to make the specified payment and consequential stay of the impugned order and lapse of the bank guarantees upon compliance.

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