Erroneous factual premise in pre-deposit waiver led to remand for fresh consideration of excise duty and penalty relief.

The Tribunal's refusal to waive pre-deposit of excise duty and penalty was set aside because it rested on an erroneous factual assumption about the petitioner's profits. The Tribunal had proceeded on the basis of a profit exceeding Rs. 6 lakhs in the relevant year, whereas the record showed net profit of only Rs. 6,250.44 and a net loss in the following year. Since the discretion on waiver had to be exercised on correct financial facts, the matter was remitted to the Tribunal for fresh consideration in accordance with law.

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Issues: Whether the Tribunal's order rejecting waiver of pre-deposit of excise duty and penalty was liable to be set aside because it proceeded on an erroneous factual assumption about the petitioner's profits.

Analysis: The Tribunal declined waiver mainly on the basis that the petitioner had earned a profit of over Rs. 6 lakhs in the relevant preceding year. The material placed before the Court showed that the net profit for that year was only Rs. 6,250.44, and that the subsequent year reflected a net loss. The Court held that the Tribunal's conclusion rested on an incorrect factual premise and that the effect of the correct figures on the exercise of discretion could not be judged by the Court in place of the Tribunal.

Conclusion: The order rejecting waiver of pre-deposit was set aside and the matter was remitted to the Tribunal for fresh consideration in accordance with law.

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