Prima facie classification dispute and financial hardship did not justify full waiver; limited pre-deposit was ordered instead.

A classification dispute and request for complete waiver of pre-deposit were rejected at the interim stage because the Chemical Examiner's report supported the view that the product contained dicalcium phosphate as a calcium supplement or pharmaceutical aid, and the alternative claim that it operated only as a preservative or anti-caking agent was not made out prima facie. Financial hardship was also not established for full waiver: the BIFR reference remained only at the enquiry stage, and the profit and loss account was affected by largely notional depreciation. Partial relief was therefore granted by requiring a limited pre-deposit and staying recovery of the balance duty and penalty.

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Issues: (i) whether the appellants had made out a prima facie case for complete waiver of pre-deposit in a classification dispute concerning the product; (ii) whether the appellants established financial hardship warranting full waiver of the duty and penalty amount.

Issue (i): whether the appellants had made out a prima facie case for complete waiver of pre-deposit in a classification dispute concerning the product.

Analysis: The assessment was founded on the Chemical Examiner's report, which indicated that the product contained dicalcium phosphate as a calcium supplement or pharmaceutical aid. On that basis, the contention that the ingredient functioned only as a preservative or anti-caking agent was not shown prima facie. The classification dispute therefore did not justify complete waiver at the interim stage.

Conclusion: The appellants did not establish a prima facie case for full waiver in their favour.

Issue (ii): whether the appellants established financial hardship warranting full waiver of the duty and penalty amount.

Analysis: The materials placed on record showed that the reference to BIFR was still at the enquiry stage and had not been accepted. The profit and loss account also reflected income and losses significantly affected by depreciation, which was treated as largely notional. In these circumstances, only partial waiver was considered appropriate.

Conclusion: Financial hardship sufficient for complete waiver was not made out, but partial relief was granted by directing a limited pre-deposit and staying recovery of the balance.

Final Conclusion: The appellants were required to make a limited pre-deposit, and recovery of the remaining duty and penalty was stayed pending compliance.

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