Pre-deposit hardship relief under excise appeal rules allowed where an arguable case and financial distress were shown.

An appellate pre-deposit under Section 35F of the Central Excises and Salt Act, 1944 may be moderated where the assessee shows financial hardship and the appeal raises an arguable case. The financial position of the assessee should be considered before fixing the deposit amount, and an excessive pre-deposit can be reduced accordingly. On the facts noted, the deposit requirement was cut from Rs. 5,00,000 to Rs. 2,00,000, with the balance waived until disposal of the appeal.

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Issues: Whether the pre-deposit condition imposed for entertaining the appeal under Section 35F of the Central Excises and Salt Act, 1944 required modification in view of the assessee's financial hardship and the existence of an arguable case.

Analysis: The appeal was found to disclose an arguable case, and the financial position of the assessee ought to have been considered before fixing the amount of pre-deposit. The original direction to deposit Rs. 5,00,000 was therefore held to be excessive in the circumstances.

Conclusion: The deposit condition was reduced to Rs. 2,00,000, and the balance was waived till disposal of the appeal.

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