Pre-deposit waiver under Central Excise law depends on prima facie merits and hardship; sick company status does not ensure full exemption.

A pre-deposit under Section 35F of the Central Excise Act is not automatically covered by the protection of Section 22 of the Sick Industrial Companies (Special Provisions) Act, 1985. Waiver depends on a prima facie case and the facts showing financial hardship. On the record considered, the appellant did not establish a strong prima facie case for complete waiver, as the materials suggested possible clandestine removal and the limitation plea was not persuasive at that stage. Limited relief was therefore granted by directing a partial deposit and staying recovery of the balance pending disposal of the appeal.

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Issues: Whether the appellant was entitled to full waiver of the pre-deposit mandated under Section 35F of the Central Excise Act, and whether the plea based on financial hardship and the rehabilitation scheme under the Sick Industrial Companies (Special Provisions) Act, 1985 justified complete dispensation.

Analysis: The appellant did not establish a strong prima facie case for complete waiver. The record, including the balance sheet and surrounding circumstances, indicated possible clandestine removal of work-in-progress, and the contention regarding limitation was also not found persuasive at the prima facie stage. As to financial hardship, the company's sick status and rehabilitation claim did not warrant total exemption from pre-deposit, especially in view of the legal position that pre-deposit under Section 35F does not fall within the protective scope of Section 22 of the Sick Industrial Companies (Special Provisions) Act, 1985.

Conclusion: Full waiver was declined, but partial waiver was granted on condition of deposit of Rs. 5 lakhs within 12 weeks, with the balance pre-deposit waived and recovery stayed till disposal of the appeal.

Final Conclusion: The pre-deposit application was disposed of by granting only limited relief, balancing the prima facie merits and the appellant's financial condition.

Ratio Decidendi: A pre-deposit requirement under Section 35F of the Central Excise Act is not automatically exempted by sick industrial company protection under Section 22 of the Sick Industrial Companies (Special Provisions) Act, 1985, and waiver depends on a prima facie case and the facts of financial hardship.

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