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TMI Blog2011 (7) TMI 385X X X X Extracts X X X X X X X X Extracts X X X X ..... A.K. Jayaraj for the Appellant S. Udayakumar (CGSC) for the Respondent JUDGEMENT This writ petition has been filed challenging the impugned order of the first respondent, in Order No.249-343/11, dated 14.2.2011, and to direct the first respondent to hear the appeal filed by the petitioner, on merits, without insisting on the petitioner making a pre-deposit, as per Section 129E of the Customs Act, 1962. 2. The proprietor of the petitioner company had stated that he had worked as a Tailor in M/s. Yogam Exports, an Export Company. Earlier, one K.Gunasekhar was the proprietor of the said company, which had been started in the year, 1994. In the year 1998, the said company had closed down. The machineries of the company had been shifted to General Patters Road, Chennai, and the company had been renamed as M/s Appu Apparels Exports. KGunasekhar had started a new company in the year, 1998, with the sewing machines given to him by K.Gunasekhar for the arrears of salary due to him. While so, K.Gunasekhar had asked the petitioner to open a bank account in the Central Bank of India and the Union Bank of India. K.Gunasekhar had asked Govardhanan to sign and hand over s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... herein, without considering the statements made by Govardhanan, had passed an order for the recovery of Rs.98,36,837/- from Govardhanan, M/s. Maapillai Vinayagar Exports, Chennai, and K.Gunasekhar, holding that they were jointly and severally liable for the said amount availed by them as excise duty draw back. A sum of Rs.25 lakhs had also been imposed as penalty, under Section 114(iii) of the Customs Act, 1962. 5. Aggrieved by the said order of the second respondent Govardhanan had preferred an appeal before the first respondent Tribunal, along with a stay/waiver application. When the said application had been listed for hearing, on 14.2.2011, along with a batch of appeals, filed by certain other parties, a request had been made for adjourning the matter by four weeks, as the counsel representing Govardhanan was unwell. However, without taking note of the request for adjournment made by Govardhanan, a common order had been passed by the first respondent Tribunal, on 14.2.2011, directing pre-deposit of 50% of the duty draw back and 25% of the penalty. Challenging the said order the petitioner has preferred the present writ petition before this Court, under Article 226 of the Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed on the following decisions in support of his contentions: 9.1. In Amitava Saha vs. CESTAT [(2007 (215) E.L.T. 173 (Cal.)], it had been held as follows: "26. Mr.Boss submission that financial position need not be considered unless there was a strong prima facie case on merits or at least an arguable case is difficult to accept. If a strong prima facie case is made out, the requirement of pre-deposit would have to be waived irrespective of financial capacity of the appellant. If the appellant were to make out an arguable case for appeal the pre-deposit might still be waived but on securing the interest of the Revenue. In the case of financial hardship pre-deposit the disputed duty and/or penalty and/or part thereof would have to be waived irrespective of the prima facie merits. ....... 29. Even though the aforesaid submissions with regard to the financial capacity of the appellants have been recorded by the respondent Tribunal, the Respondent Tribunal has cursorily recorded a finding that the contention of the appellants that they were not in a position to pay cannot be accepted. The Respondent Tribunal has further proceeded on the basis penalty of Rs.5,000/- (sic) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 case for grant of stay is made out or not and the balance of convenience lies in whose favor." 10. Per contra, the learned counsel appearing on behalf of the second respondent had submitted that the petitioner had not raised, specifically, the ground of 'financial hardship', as mentioned in Section 129E of the Customs Act, 1962. Further, no materials had been placed before the first respondent to substantiate the contentions raised on behalf of the petitioner. The application filed on behalf of the petitioner, for the waiver of pre-deposit of penalty, is bereft of facts and particulars. 11. In such circumstances, it is not open to the petitioner to allege that the first respondent had not considered the contentions raised on behalf of the petitioner and that the impugned order had been passed by the first respondent, without g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t appears that the demand raised has no legs to stand on, it would be undesirable to require the assessee to pay full or substantive part of the demand. Petitions for stay should not be disposed of in a routine manner unmindful of the consequences flowing from the order requiring the assessee to deposit full or part of the demand. There can be no rule of universal application in such matters and the order has to be passed keeping in view the factual scenario involved. Merely because the Supreme Court has indicated the principles that does not give a license to the forum/authority to pass an order which cannot be sustained on the touchstone of fairness, legality and public interest. Where denial of interim relief may lead to public mischief, grave irreparable private injury or shake a citizens' faith in the impartiality of public administration, interim relief can be given. Two significant expressions used in Section 35-F of the Central Excise Act, 1944, are "undue hardship to such person" and "safeguard the interests of revenue". Therefore, while dealing with the application twin requirements of considerations have to be kept in view The aspect of undue hardship is a matter ..... X X X X Extracts X X X X X X X X Extracts X X X X
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