Omitted statutory provision cannot sustain recovery, so pre-deposit was waived and recovery stayed on a strong prima facie case.

A demand linked to the special compounded levy scheme and denial of Modvat credit was challenged on the ground that it arose under Rule 96ZL after that rule had been omitted. The Tribunal applied the principle that an order made under a statutory provision after its omission is non est unless saved by a saving clause. On that basis, it found a strong prima facie case for interim relief and dispensed with pre-deposit of the duty and penalty, while staying recovery pending appeal.

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Issues: Whether pre-deposit of the disputed duty and penalty should be waived and recovery stayed where the demand arose under a rule that had been omitted, and whether the applicants had made out a prima facie case for interim relief.

Analysis: The dispute concerned duty confirmed under the special compounded levy scheme, together with denial of Modvat credit. The decisive consideration was that the demand was traceable to Rule 96ZL, and the Tribunal applied the principle that an order passed under a provision after its omission from the statute is non est unless protected by a saving clause. On that basis, and for the purpose of the stay application, the applicants were found to have established a strong prima facie case.

Conclusion: Pre-deposit of the duty and penalty was dispensed with and recovery was stayed pending the appeal.

Ratio Decidendi: An order founded on a statutory provision after its omission is unenforceable in the absence of a saving clause, and such a defect can justify waiver of pre-deposit and stay of recovery at the interim stage.

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