2009 (12) TMI 970 - HC - Central Excise

Pre-deposit - Held that - the Respondent shall be entitled to invoke and encash the aforesaid Bank Guarantee and on invoking the Bank Guarantee the ABN Amro Bank shall pay the aforesaid amount to the Respondent. On encashment of this Bank Guarantee, the condition of pre-deposit shall be treated as satisfied - petition allowed.

Summary

Issues:
1. Demand of duty and penalty against two helicopters.
2. Tribunal's order for payment of &8377; 5 crores.
3. Consideration of Bank Guarantee by the Tribunal.
4. Bank Guarantee for helicopter VT-AZX and its release.

Analysis:

Issue 1: Demand of duty and penalty against two helicopters
The Commissioner demanded duty of &8377; 10.76 crores and &8377; 10.45 crores against two helicopters, along with penalties of &8377; 2 crores and &8377; 3 crores respectively. The Petitioner appealed against this order before the Tribunal, which directed the payment of &8377; 5 crores. The writ petition was filed challenging this order, but the Court found no grounds for interference, considering all aspects were duly considered.

Issue 2: Tribunal's order for payment of &8377; 5 crores
The Tribunal's order for payment of &8377; 5 crores was challenged in the writ petition. The Court observed that a prima facie view was sufficient at this stage, ensuring all necessary aspects were taken into account while passing the order. The Court found no need for interference with the Tribunal's decision.

Issue 3: Consideration of Bank Guarantee by the Tribunal
The Petitioner had furnished a Bank Guarantee of &8377; 5,38,26,043.50 as per previous court orders. However, the Tribunal did not consider this Bank Guarantee. The Court acknowledged this oversight and modified the Tribunal's order to allow the Respondent to invoke and encash the Bank Guarantee. Upon encashment, the condition of pre-deposit would be considered satisfied.

Issue 4: Bank Guarantee for helicopter VT-AZX and its release
Regarding helicopter VT-AZX, although the Commissioner had initiated proceedings, no duty or penalty was levied in the order. The Petitioner had provided a Bank Guarantee of &8377; 1,28,64,714 for this helicopter. The Court directed the Petitioner to make a representation to the Commissioner for the release of this Bank Guarantee, allowing the Commissioner to take appropriate action on the matter.

In conclusion, the writ petition was disposed of with modifications to the Tribunal's order regarding the Bank Guarantee and directions for the release of the Bank Guarantee for helicopter VT-AZX.