Compound levy capacity assessment: prescribed statutory formula prevailed, and unconditional stay of recovery was granted.

Compound levy and annual capacity determination were challenged on the basis that the statutory formula for assessing capacity had to be applied as prescribed, and the Revenue could not adopt a different basis by treating the change in parameters as ineffective. The reduction in centre distance between pinions was verified, while the dispute over the use of wobblers and its effect on finishing rollers did not displace the prescribed assessment method. On that material, the matter disclosed a strong prima facie case and financial hardship, so unconditional stay of recovery and waiver of pre-deposit were granted.

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Issues: Whether the assessee was entitled to unconditional stay of recovery and waiver of pre-deposit in respect of the demand raised on the basis of compound levy and annual capacity determination.

Analysis: The demand was challenged on the ground that the applicable statutory formula for determining capacity had to be applied as prescribed, and that the Revenue could not substitute a different basis by treating the change in parameters as ineffective. It was noted that the centre distance between pinions had been reduced and verified by the Revenue, while the dispute regarding the use of wobblers and its effect on the finishing rollers did not displace the prescribed method of assessment. The matter was treated as disclosing a strong prima facie case, and the financial material on record also indicated hardship.

Outcome: The stay application was allowed unconditionally and recovery of the demanded amount was stayed.

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