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TMI Blog2013 (10) TMI 1098X X X X Extracts X X X X X X X X Extracts X X X X ..... r from the aforesaid defects, impose its own perception of the merits of the case whatever be the nature of “undue hardship”. The appellant has not pleaded any financial hardship or financial distress in support of its plea of “undue hardship” and has mainly confined its pleadings to the merits of the demand raised by the revenue - A perusal of the orders passed by the Assessing Officer and the Appellate Authority do not enable us to record an emphatic finding in favour of the appellant that duty demanded and penalty levied are illegal or could not have been imposed. The question whether the duty was levied merely as the appellant and its partner surrendered income to the Income Tax Department, is a matter to be considered and decided ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d from staying the entire amount. The finding that the appellant has a prima-facie case, is sufficient to stay the entire recovery and not merely 50% as allowed by the CESTAT. It is argued that the impugned demand is legally unsustainable as authorities failed to take into consideration the fact that duty has been demanded on two accounts i.e. Rs.32 lacs surrendered by the appellant and Rs.16 lacs by Smt. Kailash Malhotra, wife of the appellant, to the Income Tax Department during a survey conducted on 17.09.2004. The demand of excise duty based upon the income in the absence of any evidence of clandestine manufacture and clearance of goods, is illegal and void. The department has not recorded the statement of any consignee or any other per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or of jurisdiction or of law, the appeal may be dismissed without any modification in the impugned order. We have heard counsel for the parties, perused the impugned order as well as the orders passed by the Assessing Officer and the Appellate Authority and in fact are surprised as to why an appeal has been filed. The CESTAT has after considering the prayer for stay of the condition of pre-deposit and upon consideration of arguments advanced, held as follows: - 2. We find a prima facie case in favour of the petitioner/appellant and grant stay of further proceedings pursuant to the order in original on condition that the petitioner deposits 50% of the amount of liability as stipulated in the adjudication order, to the credit of Revenu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , the Commissioner (Appeals) shall, where it is possible to do so, decide such application within thirty days from the date of its filing. A perusal of Section 35F of the Act, reveals that a person desirous of appealing against an order relating to any duty demanded or any penalty levied shall pending the appeal deposit with the adjudicating authority the duty demanded or penalty levied. The proviso, however, empowers the CESTAT or the Commissioner (Appeals) if the duty demanded or penalty levied causes undue hardship to such person to dispense with such deposit subject to such conditions as may be deemed fit so as to safeguard the interest of the revenue. Section 35F of the Act, requires the CESTAT, while considering a prayer for stay ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3) that under Indian conditions expression undue hardship is normally related to economic hardship. Undue which means something which is not merited by the conduct of the claimant, or is very much disproportionate to it. Undue hardship is caused when the hardship is not warranted by the circumstances. 13. For a hardship to be 'undue' it must be shown that the particular burden to have to observe or perform the requirement is out of proportion to the nature of the requirement itself, and the benefit which the applicant would derive from compliance with it. 14. The word undue adds something more than just hardship. It means an excessive hardship or a hardship greater than the circumstances warrant. 15. The other aspect relates to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... financial distress in support of its plea of undue hardship and has mainly confined its pleadings to the merits of the demand raised by the revenue. A perusal of the orders passed by the Assessing Officer and the Appellate Authority do not enable us to record an emphatic finding in favour of the appellant that duty demanded and penalty levied are illegal or could not have been imposed. The question whether the duty was levied merely as the appellant and its partner surrendered income to the Income Tax Department, is a matter to be considered and decided after appraisal of the entire voluminous record. Recording of any firm opinion, at this stage, would prejudice the rights of the parties. The appellant admittedly, surrendered substantial ..... X X X X Extracts X X X X X X X X Extracts X X X X
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