2013 (11) TMI 290 - AT - Central Excise

Modification of Stay order Reduction in Pre-deposit Held that - From the balance sheet that the appellant is reporting operating loss and net loss - When the stay petition was heard on 15.04.13, this balance sheet was not produced - the appellant is making a loss, but has revenue operations going on, from which appellant can definitely spare some amount towards the pre-deposit - Keeping the financial hardships in mind, also keeping in mind that the appellant has complied to the extent of 50% of our stay order, it would be fit to reduce the pre-deposit ordered by us from Rs.10 crores to Rs.6.50 crores upon such submission rest of the duty to be waived till the disposal Partial stay granted.

Summary

Issues involved:
1. Modification of stay order due to financial hardships.

Analysis:
The judgment pertains to an application for the modification of a stay order issued by the Appellate Tribunal CESTAT AHMEDABAD. The appellant had been directed to deposit Rs.10 crores as per the original stay order. The appellant, through their counsel, argued that they had deposited/reversed Rs.5 crores in an account and provided financial documents showing severe financial hardships, including a loss of Rs.150.87 crores. The appellant requested a modification of the pre-deposit amount due to the financial difficulties faced. On the other hand, the Departmental Representative (D.R.) contended that the financial hardship plea was not raised initially during the hearing of the stay petition.

Upon considering both sides, the Tribunal found that the appellant had not raised the financial hardship plea earlier due to the unavailability of the balance sheet. The Tribunal acknowledged the appellant's operating and net losses but noted that the appellant still had revenue operations. Considering the financial hardships and the appellant's compliance with 50% of the original pre-deposit order, the Tribunal decided to reduce the pre-deposit amount from Rs.10 crores to Rs.6.50 crores. The appellant was directed to deposit Rs.1.5 crores within four weeks and report compliance on a specified date. The Tribunal warned that failure to comply would result in the dismissal of the appeals without further indulgence.

In conclusion, the judgment highlights the importance of timely disclosure of financial hardships and the Tribunal's discretion to modify pre-deposit amounts based on the circumstances presented. The decision emphasizes the need for compliance with tribunal orders and sets a clear deadline for the appellant to meet the revised deposit requirement to proceed with the appeals on merits.