Pre-deposit waiver requires a strong prima facie case and financial hardship; denial of cross-examination alone is insufficient.

Complete waiver of pre-deposit was declined in a stay application because the applicants did not show a strong prima facie case or adequate financial hardship. The demand rested on audited balance sheets, employee statements and other departmental material, and the applicants' explanation about timber sales was not accepted at the prima facie stage. The plea of natural justice based on denial of cross-examination also failed, as the relied-upon statements had been supplied and cross-examination is not an absolute right in departmental proceedings. Partial relief was granted, with deposit directed as a condition for continuation of the appeal.

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Issues: Whether the applicants were entitled to complete waiver of pre-deposit of duty and penalties in the stay application.

Analysis: The demand was founded on audited balance sheets, employee statements and other material relied upon by the department. The applicants' explanation regarding timber sales was not accepted at the prima facie stage in view of the statements of their own employees. The plea of violation of natural justice on the ground of denial of cross-examination was not accepted, as the relied-upon statements had been furnished and cross-examination is not an absolute right in departmental proceedings. The plea of financial hardship was also not established, as the provisional balance sheet did not constitute sufficient support for complete waiver. The applicants, therefore, did not make out a strong prima facie case for total dispensation of pre-deposit.

Conclusion: Complete waiver of pre-deposit was declined, and partial deposit was ordered with waiver of the balance on compliance.

Final Conclusion: The stay application was disposed of by granting only partial relief and directing deposit of a substantial amount as a condition for continuation of the appeal.

Ratio Decidendi: In proceedings for waiver of pre-deposit, complete dispensation is not warranted unless a strong prima facie case and adequate financial hardship are shown; denial of cross-examination does not by itself vitiate the proceedings where the relied-upon material has been supplied and can be contested on the record.

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