Pre-deposit condition in penalty appeal set aside where directorship was prima facie unproved and hardship was shown.

Pre-deposit of 10% of the penalty amount was treated as an onerous condition where there was a prima facie basis to dispute the petitioner's liability. The Court noted material suggesting that she was not a director of the penalised company, that she was linked to a different legal entity, and that the record did not show her induction as a director in the newly incorporated company. Because the merits were still to be examined by the Tribunal, insisting on pre-deposit was likely to cause undue hardship, and the condition was set aside.

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Issues: Whether the condition requiring pre-deposit of 10% of the penalty amount for hearing of the appeal on merits was liable to be set aside.

Analysis: On the material placed before it, the Court found a prima facie basis for the petitioner's plea that she was not a director of the company against whom the penalty had been imposed. The Court noted that the petitioner was associated with a different legal entity and that there was nothing on record to show her induction as a director in the newly incorporated company. In these circumstances, insisting on pre-deposit as a condition for hearing of the appeal was held likely to cause undue hardship, especially when the merits of the controversy were still to be decided by the Tribunal.

Conclusion: The condition of pre-deposit of 10% of the penalty amount was set aside in favour of the petitioner.

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