Partial pre-deposit in excise demand upheld after prima facie denial of exemption and consideration of financial hardship.

Interference with a partial pre-deposit order was declined where the appellate authority had applied its discretion after recording a prima facie view that the exemption notification did not cover the differential central excise duty demand, and after considering the assessee's financial position and BIFR-related circumstances. The authority reduced the deposit, allowed instalments, and waived the entire penalty. The Court also noted that clearance of goods under a classification list did not prevent issuance of a show-cause notice or levy of duty under the statutory scheme. No basis was found to disturb the discretionary order.

---

---

Issues: Whether interference was warranted with the order requiring partial pre-deposit of central excise duty while granting waiver of the penalty.

Analysis: The demand arose from differential central excise duty claimed to be payable under Notification No. 178/88. The appellate authority had examined the material, recorded a prima facie view that the notification did not apply, considered the financial position reflected in the balance-sheet and BIFR-related circumstances, reduced the pre-deposit to a sum payable in instalments, and waived the entire penalty. The Court noted that the petitioner's goods had been cleared under a classification list, but that circumstance did not bar issuance of a show-cause notice or the levy of duty under the statutory regime. The Court found no reason to disturb the discretionary order of the appellate authority.

Conclusion: Interference with the pre-deposit order was refused, and the petitioner's challenge failed.

---