Pre-deposit waiver requires prima facie case and balance of convenience, not financial hardship alone.

In waiver of pre-deposit under Section 35F of the Central Excises and Salt Act, 1944, the appellate authority must consider all relevant factors, not financial hardship alone. A strong prima facie case, the balance of convenience, and the overall doubt surrounding the demand are material considerations, especially where the assessee is otherwise protected by a bank guarantee. A mechanically narrow approach confined to hardship is impermissible. The refusal to waive deposit was therefore unsustainable, and the appeals could proceed without insisting on pre-deposit as a condition precedent.

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Issues: Whether, in considering waiver of pre-deposit under Section 35F of the Central Excises and Salt Act, 1944, the appellate authority was confined to financial hardship alone, or was also required to consider the existence of a prima facie case and balance of convenience.

Analysis: The petitioners had established that an earlier appellate order, which had accepted the normal price under Section 4(1)(a) of the Central Excises and Salt Act, 1944, had attained finality and was a relevant factor supporting their challenge. The appellate authority nevertheless rejected the stay applications on the footing that hardship was the only relevant consideration and that the petitioners had not produced financial material. The Court held that this approach was too narrow. In an application for waiver of pre-deposit, the appellate authority must consider all relevant factors, including a strong prima facie case and balance of convenience, particularly where the demand itself is seriously in doubt and the assessee is protected by a bank guarantee arrangement.

Conclusion: The refusal to waive pre-deposit was unsustainable, and the petitioners were entitled to have their appeals heard without insisting on deposit as a condition precedent.

Ratio Decidendi: In proceedings for waiver of pre-deposit under Section 35F of the Central Excises and Salt Act, 1944, the appellate authority must consider not only financial hardship but also the strength of the prima facie case and the balance of convenience; a mechanically narrow focus on hardship alone is impermissible.

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