Pre-deposit waiver and recovery stay granted where applicants showed a strong prima facie case for excise exemption eligibility.

Interim relief on excise duty was sought on the basis of a claimed exemption under Notification No. 24/91, supported by certificates indicating installed capacity within the notified limit. The department relied on an earlier industrial licence to argue that installed capacity exceeded the limit. On the material placed, the applicants established a strong prima facie case on eligibility for the notification, and their accumulated losses and sick-unit status supported relief. The pre-deposit requirement was dispensed with, and recovery of the duty demand was stayed pending disposal of the appeal.

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Issues: Whether pre-deposit of the duty demand should be dispensed with and recovery stayed pending disposal of the appeal.

Analysis: The applicants claimed exemption under Notification No. 24/91 dated 25-7-1991 and relied on certificates showing installed capacity within the notified limit, while the department relied on an earlier industrial licence to contend that the installed capacity exceeded the limit. On the material placed, the applicants showed a strong prima facie case as to eligibility for the notification. Heavy accumulated losses and sick-unit status were also relevant to the request for interim relief.

Conclusion: The requirement of pre-deposit was dispensed with and recovery of the duty was stayed during the pendency of the appeal.

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