Pre-deposit hardship under excise law cannot stand once Supreme Court classification settles the assessee's case.

Where the Supreme Court had already held that white cement with rapid hardening properties falls under Heading 2502.20 rather than the residuary entry, insistence on pre-deposit under Section 35F of the Central Excises Act was treated as unjustified when it would cause undue hardship. The petitioner had already discharged duty at the claimed rate and a substantial part of the differential demand had been recovered, so the demand was substantially secured. In that setting, the Tribunal could not refuse to modify its interim order merely because the Supreme Court ruling came later, and the pre-deposit requirement was held unsustainable.

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Issues: Whether, in the light of the Supreme Court's ruling on classification of white cement with rapid hardening properties, the Tribunal could insist on pre-deposit under Section 35F of the Central Excises Act, 1944.

Analysis: The petitioner had already paid duty at the claimed rate and a substantial part of the differential demand had been recovered. The Supreme Court had subsequently held that white cement having rapid hardening properties falls under Heading 2502.20 and not under the residuary entry. In that situation, requiring pre-deposit would have caused undue hardship, particularly when the petitioner was already a sick unit and the demand was substantially secured by recovery. The Tribunal's refusal to modify its earlier interim order merely because the Supreme Court decision came later was not justified.

Conclusion: The insistence on pre-deposit was unsustainable. The impugned orders were liable to be quashed and the appeal was to be heard without pre-deposit.

Ratio Decidendi: When the governing substantive classification issue has already been settled by the Supreme Court in favour of the assessee, insistence on pre-deposit under Section 35F cannot be maintained if it would operate as undue hardship.

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