Pre-deposit waiver must consider undue hardship where assets were taken over and sold; full exemption was not sustained.

In considering waiver of pre-deposit under Section 129E of the Customs Act, the authority must evaluate whether insistence on deposit would cause undue hardship on the facts placed before it. The High Court noted that the Tribunal had not adequately addressed the petitioner's claim that its assets had been taken over and sold and that the machine was under a receiver, circumstances relevant to hardship. As that assertion was not effectively controverted, the hardship plea required proper consideration in the exercise of discretion. The refusal to grant full exemption was therefore interfered with, and the petitioner was directed to deposit 50% of the customs duty before the appeal could proceed.

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Issues: Whether the Tribunal was justified in refusing exemption from pre-deposit under Section 129E of the Customs Act, 1962 despite the petitioner's plea of undue hardship arising from takeover and sale of assets.

Analysis: Relief under Section 129E turns on whether insistence on pre-deposit would cause undue hardship. The Tribunal had considered the petitioner's liability to duty but did not sufficiently account for the asserted fact that the petitioner's assets had been taken over and sold and that the machine had been dealt with by a receiver. That circumstance was relevant to the question of hardship. Since the respondents did not controvert the assertion with supporting material, the hardship plea required consideration while exercising discretion on pre-deposit.

Conclusion: The refusal to grant exemption from pre-deposit was not on the facts. The order was set aside and the petitioner was directed to deposit 50% of the customs duty within eight weeks, whereafter the Tribunal could proceed in accordance with law.

Ratio Decidendi: While considering an for pre-deposit waiver under Section 129E of the Customs Act, 1962, the authority must account for relevant circumstances showing undue hardship, and failure to do so may justify interference and reduction of the pre-deposit burden.

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