Conflicting classification rulings justified waiver of pre-deposit and stay on coercive recovery pending Larger Bench consideration.

Conflicting co-ordinate Bench views on the classification of identical goods created an arguable case for reference to a Larger Bench, one view treating the goods as ayurvedic medicine and another as perfumed hair oil. In that situation, the requirement of pre-deposit was waived under the appellate deposit provision, and the Revenue was restrained from taking coercive recovery action until further orders. The appeals were directed to be placed before a Larger Bench for consideration of the classification dispute.

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Issues: Whether pre-deposit under Section 35F of the Central Excise Act, 1944 should be waived and recovery stayed pending reference of the classification dispute to a Larger Bench.

Analysis: Conflicting views had been taken by co-ordinate Benches on the classification of identical goods, one view treating them as ayurvedic medicine and another as perfumed hair oil. In view of this conflict, the appeal raised an arguable case fit for consideration by a Larger Bench.

Outcome: Pre-deposit was waived and the Revenue was directed not to take coercive steps for recovery until further orders, with the appeals posted before a Larger Bench.

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