1987 (1) TMI 108

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....Central Excise Rules. Finally, by Ext. P5 order dated 19-6-1986, the first respondent demanded duty of Rs. 17,47,091.53 besides penalty of Rs. 5,00,000/-. The petitioner filed an appeal before the 2nd respondent, Appellate Tribunal, evidenced by Ext. P7. He also filed Ext. P8 application along with an affidavit, Ext. P9, for stay of recovery of the entire amount levied by way of excise duty, penalty, etc. By Ext. P10 order dated 27-10-1986, the Appellate Tribunal directed the petitioner to make a deposit of Rs. 5,00,000/- on or before 29-1-1987 and further observed that subject to the said prior deposit, the balance of duty and penalty would stand dispensed with. It was ordered that the appeal will be posted to 30-1-1987. In this original p....

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....fore the first respondent, and there is violation of the principles of natural justice. It is also contended that the duty levied is unjustified and lacks factual and legal basis. There is also a contention that the assessment ex facie is not on the petitioner. According to the petitioner, these and other matters pleaded on the merits would go to show that the petitioner has a prima facie or arguable case. If that be so, in the present context, when the petitioner is not in a position to make any deposit of the amount demanded, a direction insisting a pre-deposit will really render any decision that is likely to be rendered in the appeal ineffectual or illusory. The question posed for consideration requires detailed analysis on the merits. ....

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....e caused to the assessee and keeping in mind the financial background of the assessee, directed him only to pay less than 25 per cent of the total amount levied as excise duty and penalty. Hence, he submitted that Ext. P10 cannot be attacked as illegal or unreasonable. 4. Having considered the rival contentions of the counsel appearing on both sides, I am of the view that the 2nd respondent has failed to bear in mind the essential aspects in exercise of its discretion under S. 35F of the Act. It cannot be said that the merits involved in the case are totally irrelevant in considering the matter. The question involved in the appeal and as to whether the assessee, the petitioner has a prima facie case as opposed to a frivolous one, is an i....