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TMI Blog2014 (12) TMI 1098X X X X Extracts X X X X X X X X Extracts X X X X ..... re-deposit also stands set aside. - Matter remanded back - Following decision of Mehsana Dist. Co-OP. Milk P.U. Ltd. Vs. Union of India [2003 (3) TMI 113 - SUPREME COURT OF INDIA] - Decided in favour of assesse. - Central Excise Appeal No. (20) of 2014, Central Excise Appeal No. (21) of 2014, Central Excise Appeal No. (22) of 2014, Central Excise Appeal No. (27) of 2014 - - - Dated:- 4-12-2014 - Hon'ble Krishna Murari And Hon'ble Rakesh Srivastava,JJ. ORDER (Delivered by Hon'ble Krishna Murari, J.) These four appeals under Section 35 (G) of the Central Excise Act, 1944 (hereinafter referred to as the Act, 1944) are directed against the identical orders dated 26.02.2013 passed by Customs, Excise and Service Tax Tribunal, New Delhi (for short the Tribunal) refusing to allow full waiver of pre-deposit of outstanding demand of tax and penalty as prescribed under Section 35 F of the Act, 1944 and directing to deposit 40% of the demand to maintain the appeals. The orders dated 11.04.2013 dismissing the appeals for non-compliance of orders passed under Section 35 F are also subject matter of challenge in these appeals. Since all the four appeals have been fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... all, pending the appeal, deposit with the adjudicating authority the duty demanded or the penalty levied: Provided that where in any particular case, the Commissioner (Appeals) or the Appellate Tribunal is of opinion that the deposit of duty demanded or penalty levied would cause undue hardship to such person, the Commissioner (Appeals) or, as the case may be, the Appellate Tribunal, may dispense with such deposit subject to such conditions as he or it may deem fit to impose so as to safeguard the interests of revenue: Provided further that where an application is filed before the Commissioner (Appeals) for dispensing with the deposit of duty demanded or penalty levied under the first proviso, 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 the aforesaid provisions goes to show that Section 35 of the Act, 1944 prescribes condition of pre-deposit of duty demanded and the penalty levied for maintaining the appeal by the assessee. However, under proviso, the Tribunal has been vested with the powers to dispense with such deposit, on forming an opinion that such deposit may ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ind as to whether the appellant has a strong prima facie case on merit. In case it is covered by the judgment of a Court/Tribunal binding upon the Appellate Authority, it should apply its mind as to whether in view of the said judgment, the appellant is likely to succeed on merit. If an appellant having strong prima facie case, is asked to deposit the amount of assessment so made or penalty so levied, it would cause undue hardship to him, though there may be no financial restrain on the appellant running in a good financial condition. The arguments that appellant is in a position to deposit or if he succeeds in appeal, he will be entitled to get the refund, are not the considerations for deciding the application. The order of the Appellate Authority itself must show that it had applied its mind to the issue raised by the appellant and it has been considered in accordance with the law. The expression undue hardship has a wider connotation as it takes within its ambit the case where the assessee is asked to deposit the amount even if he is likely to exonerate from the total liability on disposal of his appeal. Dispensation of deposit should also be allowed where two views are po ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es that does not give a licence 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 citizen's faith in the impartiality of public administration, interim relief can be given. The Hon'ble Supreme Court again in the case of Bhavya Apparels Pvt. Ltd. Vs. Union of India, 2007 (216) E.L.T. 347 (S.C.) has observed as under. The learned Additional Solicitor General very fairly submits that a part of the goods is in custody of the respondents. If that be so, in our opinion, it was obligatory on the part of the Tribunal to take that factor into consideration in making the order of pre-deposit. Furthermore, while exercising its jurisdiction the tribunal was also required to apply its mind in regard to the question of undue hardship on the part of the appellants upon considering existence of a prima facie case. Merit of the case ordinarily should not otherwise be gone into unless the question on the face of it appears to be concluded. Thus, phrase 'undue hardship' has been interpreted to b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evied and the penalty imposed and directing to deposit 40% of the demanded amount is cryptic, without recording any reasons either in respect of prima facie case set up by the appellant or considering the issue of undue hardship and, thus, is rendered patently illegal. It is further pointed out that the fact that an objection dated 27.12.2009 has been filed by the appellant with respect to registration issued in Form ST-2 under category of Civil Structure Construction Work without verifying the actual service being provided by the appellant relating to maintenance/sanitation service and repair, which was exempted from payment of service tax being outside the service tax net, has not been taken into consideration while passing the impugned orders. It is further submitted that the orders rejecting the appeals for non-compliance of deposit of 40% under Section 35 F of Act, 1944 is also rendered illegal and deserves to be set aside. In reply, learned counsel appearing for the respondents contended that the appellant being registered under ST-2 category, has rightly been assessed and there was no good reason for any waiver of the condition of pre-deposit, still the Tribunal waived 60 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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