Clandestine removal allegations and corroborative evidence defeat total waiver of pre-deposit at the stay stage.

At the stay stage under Section 35F of the Central Excise Act, total waiver of pre-deposit was refused because the record showed a prima facie case based on multiple materials, including electricity-consumption data, undisclosed raw-material supply, and other investigative evidence suggesting clandestine manufacture and removal of excisable goods. The argument that the demand rested only on electricity consumption was rejected, as the alleged discrepancies were corroborated by additional circumstances. Earlier decisions were distinguished because they involved mere estimation without comparable supporting material. Partial pre-deposit of duty, interest, and penalty was directed.

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Issues: Whether the appellants made out a prima facie case for total waiver of pre-deposit under Section 35F of the Central Excise Act, 1944 in a matter alleging clandestine manufacture and removal of excisable goods.

Analysis: The applications were considered at the stay stage, where the inquiry was confined to whether a prima facie case existed for waiver of pre-deposit. The impugned orders were found to rest on multiple materials, including electricity-consumption data, evidence of undisclosed raw-material supply, and other investigative material. The contention that the demand was based only on electricity consumption was rejected because the record also reflected corroborative circumstances pointing to clandestine production and removal. The reliance placed on earlier decisions was distinguished on facts, since those cases turned on estimation without adequate supporting material, whereas the present case involved actual investigation material and unexplained variation in consumption and production indicators.

Conclusion: No case for total waiver of pre-deposit was made out, and the appellants were directed to make partial pre-deposit of duty, interest, and penalty.

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