ORDER
M.C. Agarwal, J.
1. By this petition under Article 226 of the Constitution of India the petitioner challenges an order dated 25th July, 1995 passed by the Customs, Excise and Gold (Control) Appellate Tribunal, New Delhi, whereby it partly allowed an application moved by the petitioner under the proviso to Section 35F of the Central Excises and Salt Act, 1944 and directed it to deposit only a sum of Rs. 5,00,000/- towards excise duty of Rs. 10, 21,617.90 and penalty of Rs. 5,04,0007-.
2. I have heard the learned counsel for the petitioner and Shri Shishir Kumar, learned standing counsel for the Union of India. The Collector, Central Excise, Allahabad passed an order dated 22nd November, 1994, levying the aforesaid amounts on the petitioner, who has filed an appeal to the Tribunal being Appeal No. E/17/95-A. Section 35F of the Central Excises and Salt Act requires the appellant to deposit with the adjusting authority, the duty demanded or the penalty levied before the appeal can be disposed of. The proviso to Section 35F however permits the appellate authority to dispense with such deposit if it is of the opinion that the deposit of duty demanded or penalty levied would cause undue hardship to such person. The Tribunal in exercise of the powers under this proviso has partially waived the condition of pre-deposit and directed the petitioner appellant to deposit only Rs. 5,00,000/” as against the demand of over Rs. 15,00,000.00.
3. It was contended before the Tribunal that the order appealed against was made in violation of the principles of natural justice and the appellant was not allowed a proper opportunity of hearing. The Tribunal found that the petitioners had not made out prima facie case in their favour on this account. As regards financial hardship, the Tribunal has observed that no arguments were addressed to it on this ground and no documents to reflect their present financial position had been produced.
4. The learned counsel for the petitioner contended that the order under challenge in the appeal was passed in violation of the principle of natural justice as copies and inspection of some documents were not provided to the petitioners counsel. This is denied on behalf of the respondent and it is a matter that has to be finally thrashed out in the appeal before the Tribunal.
5. The proviso to Section 35F permits dispensation of deposits only where the deposit would cause undue hardship to such person. Financial hardship has therefore to be the main criteria for exercise of power under the said proviso. The Tribunal has stated that no arguments about financial hardship were raised before it and no documents showing the present financial condition of the appellant were filed. The learned counsel for the petitioner Shri A.P. Mathur contended that he had argued the application for waiver before the Tribunal and he had pressed this point. He however, did not deny that no documents showing the present financial position of the petitioner were filed before the Tribunal either alongwith the application for waiver or thereafter. He referred to paragraph 9 of the waiver application in which it was stated :
“That the appellants have been declared as a sick unit and under the circumstances they are not in a position to pay any amount during the pendency of the appeal. The Scheme for rehabilitation and revival is under implementation and consequently the appellants are not in a position to deposite any amount during the pendency of the appeal”.
6. The aforesaid averment patently was vague insofar as the financial capacity of the petitioner to pay the demands was concerned and there was no specific allegation that at the relevant time its financial position was such that it could not deposit the amounts demanded. The learned counsel for the petitioner laid stress on the fact that the petitioner was declared a sick unit under the Sick Industrial Companies (Special Provisions) Act, 1985, A copy of the protection order passed by the Board for Industrial and Financial Reconstruction on 29-3-1991 has been placed at page 57 of the paper book which shows that the scheme for rehabilitation of the petitioner was sanctioned on 6th of June, 1990 and the said scheme was under implementation. Thus more than four years had elapsed since the scheme of rehabilitation was put-under operation when the matter came before the Tribunal. Therefore the mere fact that several years ago the petitioner was declared a sick company does not automatically lead to the conclusion that even after the expiry of more than four years it was not in a position to deposit the amount in question.
7. The Tribunal has partially waived the condition of pre-deposit by requiring the petitioner to deposit only about 1 /3 of the demands raised and in my view no case for interference in the exercise of extra-ordinary jurisdiction of the Court under Article 226 of the Constitution of India is made out. The writ petition is accordingly rejected with costs.