Waiver of pre-deposit in excise appeal allowed where a prima facie case existed and merits were not examined.

The note addresses waiver of pre-deposit under Section 35F of the Central Excise Act, 1944 in an excise appeal. It states that where the first appellate order was passed only for non-compliance with the pre-deposit requirement and not on the merits, and the record showed a prima facie case for the assessee, insistence on pre-deposit was not justified. The matter was therefore remanded to the Commissioner (Appeals) for fresh decision on merits without requiring any pre-deposit, with an opportunity of hearing to the assessee.

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Issues: Whether the assessee was entitled to waiver of pre-deposit under Section 35F of the Central Excise Act, 1944 and whether the appeal should be remanded for decision on merits without insisting on pre-deposit.

Analysis: The impugned order had been passed only for non-compliance with the pre-deposit requirement and not on merits. The records indicated a prima facie case in favour of the assessee, and a similar stay order in another appeal had already granted full waiver. In these circumstances, insistence on pre-deposit was not justified, and the appeal ought to have been heard on merits.

Conclusion: Pre-deposit was dispensed with and the matter was remanded to the Commissioner (Appeals) to decide the assessee's appeal on merits without insisting on any pre-deposit.

Final Conclusion: The order of dismissal for want of pre-deposit was set aside, and the appellate authority was directed to adjudicate the dispute afresh on merits after giving an opportunity of hearing.

Ratio Decidendi: Where an appellate authority declines to decide an excise dispute on merits despite a prima facie case for waiver, pre-deposit should not be insisted upon and the appeal should be heard and decided on merits.

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