2015 (10) TMI 668 - HC - Central Excise

Waiver of pre deposit - whether the petitioner has a prima facie case or not and whether the imposition of any condition would cause undue hardship to the petitioner or not - Held that - There are several decisions of this Court and various Courts to the effect that the Commissioner (Appeals) should indicate application of mind in his orders to the issues of prima facie case and undue hardship before imposing any condition or before waiving pre-deposit condition. Since it is not reflected in the impugned order, the same is liable to go - Decided in favour of assessee.

Summary

Issues involved: Challenge to conditional order for waiver of pre-deposit condition and grant of stay due to lack of consideration of prima facie case and relative hardship by the Commissioner (Appeals).

Analysis:

1. Prima Facie Case and Relative Hardship Consideration:
The petitioner challenged the conditional order passed by the Commissioner (Appeals) for waiver of pre-deposit condition and for grant of stay, arguing that the Commissioner did not assess whether the petitioner had a prima facie case or if the imposed conditions would cause undue hardship. The High Court noted that the impugned order lacked reflection of the Commissioner's consideration on these crucial aspects, which is necessary as per precedents from various Courts. The Court emphasized the requirement for the Commissioner to demonstrate the application of mind to these issues before imposing conditions or waiving pre-deposit. As the Commissioner failed to do so, the High Court set aside the impugned order and directed the Commissioner to reconsider the questions of prima facie case and undue hardship, and issue a fresh order within two weeks.

2. Judgment Outcome:
The High Court allowed the writ petition, setting aside the impugned order and instructing the 1st respondent (Commissioner) to reevaluate the issues of prima facie case and undue hardship before making a decision on the application for waiver and stay. The Court specified a timeframe of two weeks for the Commissioner to issue a fresh order. The judgment concluded by stating that no costs were awarded, and the connected miscellaneous petition was closed.

In conclusion, the High Court's judgment centered on the necessity for the Commissioner (Appeals) to consider the prima facie case and undue hardship before imposing conditions or waiving pre-deposit, highlighting the importance of demonstrating such considerations in the orders. The decision to set aside the impugned order and direct a fresh assessment within a specified timeframe aimed to ensure procedural fairness and adherence to legal principles in the matter at hand.