2009 (8) TMI 723 - HC - Central Excise

Recovery of excise - respondent authorities are trying to recover the entire dues of lessee from the petitioner - are not taking any action against lessees - tripartite agreement - Held that - tenor of the agreement shows that the petitioner accepted the excise liability of lessees in the event they are so found - extraordinary jurisdiction under Article 226 of the Constitution of India is not required to be exercised

Summary

Issues:
Challenge to order and notice on grounds of natural justice and constitutional violation, protection against recovery of excise dues, interpretation of legal provisions, unequal treatment and parity with others, liability of co-sureties, jurisdiction under Article 226 of the Constitution.

Analysis:
The petition under Article 226 challenged an order and subsequent notice as violating natural justice and constitutional provisions. The petitioner sought protection from excise dues recovery for a lessee, M/s. Shree Bhavani Processors, with a tripartite agreement involving the petitioner and Anchal Processors. The petitioner argued that the respondent was unfairly targeting them for the entire dues without action against others. Section 146 of the Contract Act was cited to limit liability to 1/2. However, the court found the petition ill-conceived as the legal provision allowed the department to recover from the property owner. The tripartite agreement did not restrict recovery, and the petitioner accepted liability if found. Allegations of favoritism lacked evidence, and the respondent had taken necessary steps.

The court concluded that Article 226 jurisdiction was unnecessary as the matter involved disputed civil facts, leading to the dismissal of the petition. A request to stay the order for a higher forum approach was denied due to lack of merit in the petition. The judgment emphasized the legal provisions, lack of evidence supporting unequal treatment, and the absence of grounds for interference through extraordinary jurisdiction. The decision highlighted the importance of factual disputes in civil matters and the need for substantial evidence to support claims in legal proceedings.