ORDER P.K. Jain, J.
1. The petitioner is a manufacturer of Pan Masala which he sells in the brand names of Tan King Gurkha and Kishan Chand Gutkha' which are taxable goods under sub-heading 2106.00 of the Central Excise Tariff Act, 1985. The Central Preventive Officers of Central Excise, Kanpur visited the premises of Unit on 23-11-1996 at about 5.00 P.M. A physical verification of raw material and finished goods was made. The officers seized a vehicle loaded with finished goods parked inside the premises of Unit No. 1 of the petitioner and also seized stock of raw materials and packing materials on the ground that the same were not recorded in the books and the finished goods were over and above the recorded balance. Some incriminating loose papers and a diary were also seized. A show cause notice was served by the Commissioner of Central Excise, Kanpur for explaining as to why Central Excise duty amounting to Rs. 1,42,84,207/- and Rs. 19,60,247/- respectively be not levied under Rule 9(2) of the Central Excise Rules read with Section 11A(1) of the Central Excise Act. Notices for seizer of the goods over and above recorded balance and further excise duty for goods found loaded in the vehicle was also served. The petitioner submitted suitable replies. The authority however, confirmed the notices and raised demand of Rs. 19,60,247/- excise duty and further imposed Rs. 19,60,247/- as penalty on the petitioner and Rs. 5 lacs as penalty on Shri Sushil Kumar Gupta, the director and Rs. 50,000/- on one Shri Devesh Ranjan. Goods worth Rs. 13,790/-, Rs. 1,35,384/-, Rs. 8,39,196/- and worth Rs. 15,10,222/- and packing material were confiscated and redumption was allowed by the petitioners on payment of Rs. 7,000/-, 50,000/-, 1,25,000/- & Rs. 2,25,000/- respectively.
2. The petitioners filed appeal along with stay-cum-waiver application before the Customs, Excise and Gold (Control) Appellate Tribunal, New Delhi. The stay-cum-waiver application was decided by the Tribunal by order dated 21st December, 1998 whereby the petitioners were directed to deposit Rs. 5 lacs towards duty and Rs. 5 lacs towards penalty and Rs. 1,50,000/- on behalf of its Director and employee in terms of Section 35F of the Central Excise Act, 1944.
3. The present writ petition has been filed challenging the order of the Tribunal whereby his application stay-cum waiver has been partly rejected by the Tribunal.
4. Sri A.P. Mathur, learned Counsel for the petitioner and Shri S.P. Kesarvani, learned standing counsel for the Union of India-respondents have been heard.
5. Submission of Shri Mathur is that the specific plea regarding the demand being barred by limitation was taken before the Commissioner as well as before the Tribunal. It is further submitted that goods valued at Rs. 25,26,172/- are lying in custody of the department which itself were sufficient to secure the interest of revenue. These grounds have not been considered by the Tribunal while passing the impugned order.
6. Shri S.P. Kesarvani, learned Counsel for the respondents, however, submits that total demand raised against the petitioner is worth more than Rs. 44 lacs and considering the goods in custody of the department only Rs. 11,50,000/- were directed to be deposited and for rest of the amount waiver/stay was granted by the Tribunal. It is further submitted that it was a case of wilful suppression of facts, or contravention of the provisions of the Act. In view of the proviso to Section 11A the limitation would be 5 years and not 6 months as claimed by the petitioner and thus the demand raised by the department was prima fade well within the period of limitation. It is further submitted that waiver-cum stay application is disposed of by the Tribunal in accordance with the provisions contained in Section 35F of the Central Excises and Salt Act, 1944. (hereinafter called the Act).
7. Section 11A(1) with its explanation and Section 35F of the Act read as follows:
11-A : Recovery of duties not levied or not paid or short-levied or short-paid or erroneously refunded. - (1) When any duty of excise has not been levied or paid or has been short-levied or short-paid or erroneously refunded, a Central Excise Officer may, within six months from the relevant date, serve notice on the person chargeable with the duty which has not been levied or paid or which has been short-levied or short-paid to whom the refund has erroneously been made, requiring him to show cause why he should not pay the amount specified in the notice :
Provided that where any duty of excise has not been levied or paid or has been short levied or short paid or erroneously refunded by reason fraud, collusion or any wilful misstatement or suppression of facts, or contravention of any of the provisions of this Act or of the rules made thereunder with intent to evade payment of duty, by such person or his agent, the provisions of this sub-section shall have effect, for the words "Excise Officer", the words "Collector of Central Excise", and "six months", the words "five years" were substituted.
Explanation. - Where the service of the notice is stayed by an order of a Court, the period of such stay shall be excluded in computing the aforesaid period of six months or five years, as the case may be.
35F : Deposit pending appeal, of duty demanded or penalty levied. - Where in any appeal under this Chapter, the decision or order appealed against relates to any duty demanded in respect of goods which are not under the control of central excise authorities or any penalty levied under this Act, the person desirous of appealing against such decision or order shall, pending the appeal, deposit with the adjudicating authority the duty demanded or the penalty levied:
Provided that where in any particular case, the Collector (Appeals) or the Appellate Tribunal is of opinion that the deposit of duty demanded or penalty levied would cause undue hardship to such person, the Collector (Appeals) or, as the case may be, the Appellate Tribunal, may dispense with such deposit subject to such conditions as he or it may deem fit to impose so as to safeguard the interests of revenue.
8. Section 35F of the Act provides that deposit of the amount of Central Excise or/and penalty levied by the department is a pre-condition for entertaining the appeal. However, proviso to this section provides that when the appellate authority on the materials before it is of the opinion that the deposit of the duty or the amount of penalty would cause undue hardship to the person concerned as the case may be then in such a case such authority may dispense with such deposit subject to such conditions as may be found fit to safeguard the interest of the revenue.
9. Annexure 3 to the writ petition is copy of the application which was moved before the Appellate Tribunal under Section 35F of the Act. A perusal of this application it is no where born out that there would be any hardship to the petitioners if they are directed to deposit the amount demanded by the revenue. In the writ petition also no averments with regard to the hardship which may be caused to the petitioners if they are asked to deposit the amount directed to be deposited by the Tribunal have been made. Normally under Section 35F undue hardship whether financial or otherwise, is the sole consideration on which the appellate authority passes an order for waiving the pre-condition of deposit or part waiver of such condition and for stay of demand or part of it made by the Commissioner. In the instant case no facts are alleged or pointed out causing resultant and undue hardship to the petitioners. Therefore, it cannot be said that the order passed by the Tribunal was in any manner illegal or improper.
10. It is true that the question of limitation has not been considered by the Tribunal while passing the impugned order dated 21st December, 1998. Normally that question related to the merits of the case. However, in those ' cases where the demand raised by the department/revenue is on the face of it appeared to be barred by limitation then such question should be considered by the Appellate Authority while disposing of the application under Section 35F of the Act. In the instant case, Shri Mathur has pointed out that the demand related to a period from 1-11-1996 to 23-11-1996 and the notice was served by the Commissioner on 17-8-1997 which was on the face of it barred by limitation, since according to Mr. Mathur the demand could be raised within six months from the relevant date i.e, the period for which the excise has not been levied or paid or has been short levied or short-paid. As pointed out by Shri Kesarvani, this is a case of wilful suppression of the facts and attempt to take out the goods with an intention to evade payment of duty in contravention of provisions of the Act and Rules. Shri Kesarvani submits that in such cases the limitation is 5 years instead of 6 months as provided by the proviso to Sub-section (1) of Section 11A of the Act. In the instant case there prima facie appears substance in the submission of Shri Kesarvani. Therefore, on this ground the impugned order cannot be quashed.
11. Shri Mathur has relied upon 2 decisions rendered in Taj Beverages (P) Ltd. Agra v. Customs, Excise and Gold (Control) Appellate Tribunal, New Delhi and Anr. - 1992 (38) ECR 497 (Allahabad) and Lippy Trading Corporation v. CEGAT 1995 (79) E.L.T. 194 (All.). It is true that in these cases the Court held that when plea of bar of limitation is taken in the appeal that should be considered while disposing of application under Section 35F of the Act. However, in the instant case on the facts of the present case, in my view non-consideration of the bar of limitation at initial stage would not make the order as illegal or improper. It cannot be said that the authority has failed to exercise the jurisdiction vested in it by law or has exercised it illegally. Therefore, the order passed cannot be interfered with on this ground.
12. The other ground pressed by Shri Mathur is that goods worth more than Rs. 25 lacs are in custody of the department which is sufficient to secure the interests of the revenue. As rightly pointed out by Shri Kesarvani, the demand is for more than Rs. 44 lacs. The Tribunal has passed the order considering the fact that goods worth Rs. 25 lacs are in custody of the revenue. There does not appear any error in the order passed by. the Tribunal. Consequently the petition fails and is hereby dismissed.
No order as to costs.