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TMI Blog2009 (8) TMI 622X X X X Extracts X X X X X X X X Extracts X X X X ..... onsequently Sh. Raman B. Gupta and his others have acted contrary to the provisions of Section 8(1) and 8(2) of FERA, 1973. 4. The petitioner has contended that statements under Section 40 of FERA, 1973 were recorded of Sh. Raman B. Gupta and Sh. Atul P. Shah. Some incriminating documents are also alleged to have been recovered from the residence of Sh. Raman B. Gupta, Sh. Atul P. Shah and from the residence of Smt. Subhadraban, mother in law of Sh. Atul P. Shah. 5. The further assertion of the petitioner is that on the basis of an alleged show cause notice which was never received by him after adjudication, the respondent No. 3 has imposed a penalty of Rs.1,25,00,000/- each on the petitioner and others by order dated 26th March, 1997. 6. The petitioner further pleaded that he had filed a W.P.(C) No. 12940/2006 titled Virender Kumar Yadav v. Union of India and Ors seeking quashing of the order dated 26th March, 1997 imposing a penalty of Rs.1,25,00,000/- pursuant to the adjudication proceedings under Section 8(1) and 8(2) of FERA, 1973. The plea taken by the petitioner in that writ petition was that he became aware of the penalty imposed upon him when the proceedings were initia ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ll be out of proportion to the nature of the requirement itself and the benefit which the applicant would derive from compliance with it. In the circumstances, it was held that 'undue' is more than just hardship and it would mean excessive hardship or a greater hardship than the circumstances warrant. Without considering the documents filed by the petitioner to show that directing petitioner to deposit Rs.25 lakhs will not cause undue hardship to the petitioner and without considering whether the petitioner has a prima facie case in his favor or not, the application has been disposed of. 10. The said order is impugned by the petitioner on the grounds that the Tribunal has not even noted the pleas and contentions of the petitioner correctly. It is contended that no confessional statement was given by the petitioner which was retracted later on and on the basis of which he could be convicted. It is contended that the retracted confessional statement of a co-accused could not be the basis for imposing penalty on the petitioner especially when there are no such documents detailed in the adjudication order, which would corroborate the statement and implicate the petitioner. It is conte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to him which have not been considered at all by the Tribunal. Even the respondents have failed to rebut the same and in the circumstances no other inference could be drawn other than that the direction to the petitioner to deposit Rs.25 lakhs shall cause 'undue hardship' to him. 14. The petition is contested by the respondent, and a counter affidavit of Sh. R.K. Rawal, Assistant Director of Enforcement Directorate has been filed. It is contended that the documents seized from the premises of the co-noticees, Sh. Raman B. Gupta, Mr. Atul P. Shah and Smt. Subhadraben show that there is sufficient material to connect the participation of the petitioner in committing and abetting the offences. It is further contended that sufficient opportunities were given for personal hearing, however, no written submissions were filed by the petitioner. Regarding the retraction of the statement by Sh. Raman B.Gupta it is contended that the retraction is of no value as there is sufficient corroborative material available to implicate the petitioner. 15. It is further asserted by the respondent that the accused was sent show cause notice by post which he failed to accept and it was served by Rule 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ma facie case in his favour or not. 19. From various judicial pronouncements on this issue, the position, which emerges is that the Tribunal while considering any application for waiver of deposit is to take into account firstly the existence of a prima facie case. In case, it is found that a party has a very strong prima facie case, and/or where the errors in the impugned order are writ large on the record, in such a case, it would be competent for the Court in the exercise of its jurisdiction to grant waiver of pre deposit since in such a case requiring a pre-deposit itself would amount to "undue hardship". There is no denying of the fact that while dealing with the application for stay it is neither desirable nor proper for the Tribunal or any other authority to embark upon a detailed inquiry to find out whether the stand of the appellant before it is correct or not because expression of any opinion on merits at that juncture, without full-fledged hearing and consideration of entire material, is likely to cause prejudice to either side. But at the same time, the authority concerned is required to consider whether with reference to the material placed before it, a prima facie ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l Excise Act, 1944 noted as under: "By the impugned order, the appellants have been directed to deposit an amount of Rs.30 lakhs by way of pre deposit. The reasoning given in support of such order is wholly unsatisfactory. The Appellate Authority has not at all considered the prima facie merits and has concentrated upon the prima facie balance of convenience in the case. The Appellate Authority should have addressed its mind to the prima facie merits of the appellants' case and upon being satisfied of the same determined the quantum of deposit taking into consideration the financial hardship and other such relevant factors." 22. In the facts and circumstances it cannot be denied that the petitioner has a good prima facie case. The Tribunal has not even appreciated the contentions of the petitioner. On consideration of the pleas and contentions raised in the appeal, it will be inevitable to hold that the petitioner has a prima facie case. There is no confessional statement of the petitioner. The petitioner has not retracted his statement. The confessional statement by the co-accused implicating petitioner was retracted by him. But there are no documents shown by the respondent whi ..... 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