Pre-deposit under Section 35F requires consideration of prima facie merits and undue hardship before insisting on deposit.

Section 35F requires the appellate authority to consider both the prima facie merits of the appeal and the hardship likely to result from insisting on deposit before directing pre-deposit. On the stated facts, the prior remand for de novo consideration and the practical condonation of delay under Rule 57G(5) were relevant factors that were not properly addressed in the stay orders. As the orders did not reflect adequate application of mind to merits and undue hardship, insistence on pre-deposit was held unjustified and the matter was to be heard without such deposit.

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Issues: Whether the Commissioner (Appeals), while considering stay-cum-waiver under Section 35F, failed to consider the prima facie merits of the appeal and the question of undue hardship, and whether the orders directing pre-deposit were liable to be quashed.

Analysis: The requirement under Section 35F is to assess both the prima facie merits of the appeal and the hardship likely to be caused by insistence on deposit. The record showed that the matter had earlier been remanded for de novo consideration, and the delay in filing the declaration under Rule 57G(5) had, in substance, been treated as condoned. The impugned stay orders did not reflect proper consideration of these aspects and proceeded without due regard to the merits of the case. In those circumstances, insistence on pre-deposit was not justified.

Conclusion: The orders rejecting stay-cum-waiver and directing pre-deposit were quashed, and the appeal was directed to be heard and decided without insisting upon any pre-deposit.

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