Pre-deposit under Section 35F cannot apply to pre-commencement show cause notices; no penalty deposit was required at stay stage.

Pre-deposit under Section 35F could not be insisted upon where the show cause notice was issued before the provision came into force on 11-10-1982, as the Tribunal applied the Delhi High Court authorities cited before it. On that basis, it further held that no penalty was required to be deposited at the stay stage. The stay petition was therefore allowed unconditionally and the matter was listed for early hearing.

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Issues: Whether the requirement of pre-deposit under Section 35F could be invoked in respect of a show cause notice issued before the commencement of that provision, and whether any penalty was required to be deposited.

Analysis: The Tribunal relied on the Delhi High Court decisions cited before it and held that Section 35F could not be applied to the present case because the show cause notice was issued prior to 11-10-1982, when the provision was enforced. On that footing, the Tribunal also held that no penalty was liable to be deposited at the stay stage.

Outcome: The stay petition was allowed unconditionally and the matter was posted for early hearing.

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