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Challenge to order passed by Customs, Excise and Gold (Control) Appellate Tribunal under proviso to Section 35F of Central Excise Act, 1944 regarding pre-deposit for appeal. Analysis: The petitioners, appellants before the Customs, Excise and Gold (Control) Appellate Tribunal, challenged an order dated 26th June, 1998, passed under the proviso to Section 35F of the Central Excise Act, 1944. The Commissioner, Central Excise, levied excise duty and penalties on the petitioners, who then appealed to the Tribunal. The Tribunal has the power to dispense with the deposit required for appeal under Section 35F if it deems the deposit would cause undue hardship. The petitioners argued that the levies were unjustified, they had a strong case in appeal, and their financial position was poor due to seeking financial reconstruction under the Sick Industrial Companies Act. However, the Tribunal held that detailed evidence was needed for the case, and the petitioners did not make out a strong prima facie case for waiver. The High Court noted that the financial aspect is crucial in exercising powers under the proviso and that even if an appeal lacks merit, it cannot be summarily dismissed. The Tribunal's order was set aside as it did not properly consider the petitioners' financial situation and based its decision mainly on the merits of the case rather than the financial hardship faced by the appellants. This judgment highlights the importance of the financial aspect in deciding whether to waive the pre-deposit requirement for appeals under the Central Excise Act. The Tribunal must consider the financial hardship faced by appellants and cannot summarily dismiss appeals even if lacking in merit. The High Court emphasized that the financial situation of the appellants is a primary consideration in such cases. The Tribunal's failure to properly address the petitioners' application for dispensing with the pre-deposit led to the High Court setting aside the Tribunal's order and directing a fresh disposal of the petitioners' application in accordance with the law.
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