Pre-deposit waiver in tax appeal may be moderated where no prima facie case exists and financial hardship is considered.

A pre-deposit requirement in a tax appeal was not liable to complete waiver where the Tribunal found no prima facie case for full dispensation and also considered the petitioner's financial position. The writ court found no arbitrariness or legal infirmity in that approach, but moderated the amount to balance the competing considerations at the threshold stage of the appeal. Total waiver was therefore declined, while the pre-deposit was reduced to a lesser sum split between duty and penalty.

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Issues: Whether the Tribunal's direction requiring pre-deposit of a part of the duty and penalty deserved interference in writ jurisdiction, having regard to the prima facie case and the petitioner's financial position.

Analysis: The Tribunal had examined the dispute and found that no prima facie case was made out for complete waiver of the pre-deposit, while also taking note of the petitioner's financial position. The writ court did not find any arbitrariness or legal infirmity in the Tribunal's approach, but considered that the amount directed to be deposited should be reduced to balance the competing considerations at the threshold stage of the appeal.

Conclusion: The petitioner's request for total waiver was rejected, but the pre-deposit was reduced to Rs. 8 lakhs, comprising Rs. 7 lakhs towards duty and Rs. 1 lakh towards penalty.

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