IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA. CWP No. 9309 of 2011-A. Decided on: December 27, 2011. M.J. Packaging, through Mr. Pradeep Kumar authorized representative & power of attorney holder, Plot No. 59, HPSIDC Baddi, District Solan, Himachal Pradesh. ……….Petitioner. Versus 1. Union of India through its Secretary, Ministry of Finance Department of Revenue, North Block, New Delhi-110001. 2. Union of India through its Secretary, Ministry of Law & Justice, 4th Floor, A- Wing, Shastri Bhawan, New Delhi-110001. 3. Customs, Excise and Service Tax Appellate Tribunal (Principal Bench) through its Registrar, West Block No. 2, R.K.Puram, New Delhi-110066. 4. Commissioner of Central Excise, Chandigarh-I, Central Excise Commissionerate, Central Revenue Building, Plot No. 19, Sector 17C, Chandigarh. ……….Respondents. Coram The Hon’ble Mr. Justice Kurian Joseph, Chief Justice. The Hon’ble Mr. Justice Dev Darshan Sud, Judge. For the petitioner: Mr. Vishal Panwar, Advocate. For the respondents: Mr. Rajiv Jiwan, Central Government Counsel. ---------------------------------------------------------------------------------------------- Justice Kurian Joseph, C.J. (Oral) The writ petition is filed mainly with the following prayers:- “a) issue a Writ of Certiorari, or a writ in the nature of Certiorari or any other appropriate Writ, Order or direction calling for the papers and proceedings of the case, and after going into the legality, validity and propriety thereto, to quash and/or set aside the impugned order dated 22nd September, 2011 (ANNEXURE P-6 hereto). b) to issue a Writ of Mandamus, or a Writ in the nature of Mandamus, or any other appropriate Writ, rder or direction, directing the Respondents: 2 (i) to hear the statutory appeal bearing number E/3985/2010- EX(DB) of the petitioner unconditionally and without insisting for any pre-deposit order vide the impugned order dated 22nd September, 2011; ii) to hear the statutory appeal of the Petitioner without giving effect to the Impugned Order dated 22nd September, 2011 (Annexure P-6 hereto); iii) for costs of the Petition and orders thereon; and c) issue a Writ of Prohibition, or a Writ in the nature of Prohibition, or any other appropriate Writ, Order or direction, prohibiting the Respondents by their servants, agents and subordinates from, directly or indirectly giving effect to the Impugned Order dated 22nd September, 2011 (Annexure P-6 hereto);” 2. On 28.10.2011, in CMP No. 11067 of 2011, this Court passed the following order: “Under proviso under Section 35 F of the Central Excise Act, the Appellate Authority is bound to consider as to whether there is any undue hardship, while considering the petition for exemption from pre-deposit as a condition for hearing an appeal. The Appellate Authority has stated in the impugned order that the petitioner is in a position to make deposit of Rs. 20.00 lacs. On going through the statement made by the petitioner before us, we find it difficult to appreciate the stand taken by the Appellate Authority. There will be a direction to respondents No. 3 & 4 to file a short reply as to whether there is fund available with the petitioner, other than working fund for deposit as a pre-condition for hearing the appeal. The short reply, as above, shall be filed within two weeks. The appeal of the petitioner shall not be rejected on the only ground that the petitioner has not made deposit in terms of the impugned order, in the meanwhile.” 3 3. Though, a detailed reply has been filed by the Commissioner, we do not think it necessary to refer the same since it is mainly on merits. There is no specific response to the order, as extracted above. 4. The underlying principles of consideration of the application under Section 35 F of the Act having been considered by the Supreme Court in Benara Valves Versus Commissioner of Central Excise, reported in 2006 (204) E.L.T. 513 (S.C.), it has been held as follows: “8. It is true that on merely establishing a Prima facie case, interim order of protection should not be passed. But if on a cursory glance it appears that the demand raised has no leg to stand, it would be undesirable to require the assessee to pay full or substantive part of demand. Petitions for stay should not be disposed of in a routine matter unmindful of the consequences flowing from the order requiring the assessee to deposit full or part of the demand. There can be no rule of universal application in such matters and the order has to be passed keeping in view the factual scenario involved. Merely because this Court has indicated the principles that does not give a license to the forum/authority to pass an order which cannot be sustained on the touchstone of fairness, legality and public interest. Where denial of interim relief may lead to public mischief, grave irreparable private injury or shake a citizens’ faith in the impartiality of public administration, interim relief can be given. 11. Two significant expression used in the provisions are “undue hardship to such person” and “safeguard the interests of revenue”. Therefore, while dealing with the application twin requirements of considerations i.e. consideration of undue hardship aspect and imposition of conditions to safeguard the interest of Revenue have to be kept in view. 12. As noted above there are two important expressions in Section 35(F). One is undue hardship. This is a matter within the special knowledge of the applicant for waiver and has to be established by him. A mere assertion about undue hardship would not be sufficient. It was noted by this Court in S. Vasudeva vs. State of Karnataka and Ors. (AIR 1994 SC 923) that under Indian 4 conditions expression “Undue hardship” is normally related to economic hardship. “Undue” which means something which is not merited by the conduct of the claimant, or is very much disproportionate to it. Undue hardship is caused when the hardship is not warranted by the circumstances. 13. For a hardship to be ‘undue’ it must be shown that the particular burden to have to observe or perform the requirement is out of proportion to the nature of the requirement itself, and the benefit which the applicant would derive from compliance with it. 14. The word “undue” adds something more than just hardship. It means an excessive hardship or a hardship greater than the circumstances warrant. 15. The other aspect relates to imposition of condition of safeguard the interest of revenue. This is an aspect which the Tribunal has to bring into focus. It is for the Tribunal to impose such conditions as are deemed proper to safeguard the interest of revenue. Therefore, the Tribunal while dealing with the application has to consider materials to be placed by the assessee relating to undue hardship and also to stipulate condition as required to safeguard the interest of revenue.” 5. In Mehsana Dist. Co-op. Milk P.U. Ltd. Versus Union of India, reported in 2003 (154) E.L.T. 347 (S.C.), the Supreme Court has held that financial hardships is one of the relevant factors to be considered under Section 35 F of the Act. 6. Since, there is no consideration on all the relevant factors required to be considered under Section 35 F of the Act, we are of the view that the matter should be considered afresh by the Tribunal. Accordingly, Annexure P-6 is set aside and matter is remanded to the Tribunal for passing fresh orders on all the relevant factors, with reference to the materials produced by the petitioner as well. Dasti. (Justice Kurian Joseph), Chief Justice. December 27, 2011, ( Justice Dev Darshan Sud), (karan) Judge. 5