Bombay High Court
K.N. Guruswami Oil Mills Ltd. vs Union Of India (Uoi) on 29 February, 2000
Equivalent citations: 2000(120)ELT57(BOM)
Bench: S.H. Kapadia, A.P. Shah
JUDGMENT
1. Rule. Respondents waive service.
2. Rule made returnable forthwith.
3. By this petition, the petitioners seek to challenge the order passed by CEGAT dated 11th January, 2000.
4. Pending appeal, to CEGAT, a stay application was moved by the petitioners, inter alia, on the ground that the Company has been declared sick under the BIFR and in the circumstances, the petitioners were not in a position to pay the disputed duty amount. By the impugned order, the CEGAT accepted the contentions of the petitioners. By the impugned order CEGAT waived the condition of the pre-deposit of the disputed duty amount. However, by the same order, the department was directed to recover the disputed duty amount. Pursuant to the said order, the bank guarantee has been encashed and the amount has been recovered.
5. A bare reading of the order of the CEGAT indicates that it is self-contradictory. On one hand the condition of pre-deposit has been waived. On the other hand, CEGAT has declined to give stay of recovery. Moreover, the amount has been recovered by encashing the bank guarantee. Under the above circumstances, the impugned order is set aside and we direct, under the facts and circumstances of the above case, the department to bring back the amount into the account of the petitioners. The department shall bring in the amount back to the account of the petitioners on or before 7th April 2000. The petitioners are hereby directed to furnish bank guarantee in the same terms as it was given earlier before 14-4-2000. We may mention that in the case of Mahindra & Mahindra Limited v. Union of India , the same course of action has been taken by this Court where the Court found that the recovery has been done in a high-handed manner by encashing of a bank guarantee. In the present case, we cannot loose sight of the fact that the company is under the BIFR and hence, in the circumstances, the department could not have executed the order against the Company. Subject to above the writ petition is disposed of. No order as to costs.
6. Certified copy of the order is expedited.