2010 (9) TMI 760 - HC - Central Excise

Appeal - where no evasion of duty or non chargeability of duty is involved in this case, the security as provided in the first order would be usual personal bond to be furnished by the appellant, if any fresh recovery is sought to be made. In the event any recovery is sought to be made from the third party it is for the third party to take steps and it is not for the appellant to take care of their interest and affectation. It is open for them to approach the appropriate forum. However, if any action is taken against the third party then the third party will not be entitled to take action against the appellant. This interim order will continue till the disposal of the writ petition and it has to be understood the request of the Appeal Court to the Learned Trial Judge is a mandate and that mandate as far as practicable has to be respected - accordingly, once again request the Learned Trial Judge without wasting any further time, to decide the writ petition itself within fortnight from date of production of this order without fail

Summary

Issues:
Interim order modification refusal, delay in hearing writ petition, alternative remedy argument, recovery from third party, nature of security for recovery, disposal of writ petition.

Interim Order Modification Refusal:
The appeal challenged an interim judgment refusing to modify a previous interim order. The Trial Judge had granted ad interim relief in a specific manner earlier. The appellant sought modification of this order, arguing that the Trial Judge should have disposed of the writ petition as directed by the Appeal Court. The refusal to modify the earlier interim order was contested, with the appellant claiming the impugned Tribunal order was illegal and not supported by law. The Senior Counsel for the respondent argued that the earlier interim order adequately protected the writ petitioner's interest and had not been challenged.

Delay in Hearing Writ Petition:
The Division Bench had directed the writ petition to be heard afresh within eight weeks, but due to various reasons, the matter was not disposed of within the stipulated time. The respondents took coercive measures for recovery during this delay, prompting the appellant to file an interlocutory application for interim relief. Despite the directions, the writ petition was not heard, leading to the need for interim protection. The Trial Judge's order granting relief was not appealed against, and the delay in hearing the writ petition led to the necessity for additional interim measures.

Alternative Remedy Argument:
The appellant argued against the invocation of the alternative remedy principle, stating that the writ petition should be heard as directed by the Appeal Court. The Senior Counsel for the respondent contended that no interference was warranted as the writ petition was pending, and the previous interim order remained unchallenged. The Court declined to hear the writ petition on merit during the appeal against the interim order, emphasizing the importance of respecting the Trial Judge's jurisdiction.

Recovery from Third Party and Nature of Security:
Concerns were raised about the recovery being made from a third party, which was deemed impermissible under the law as the duty should be paid by the manufacturer, not the ultimate consumer. The Court emphasized that any recovery from a third party should be handled by the appropriate forum, and the appellant should not be responsible for their interests. The nature of security for any potential recovery was discussed, with the Court suggesting a usual personal bond as security, clarifying that the security measure needed to be specified by the Trial Judge.

Disposal of Writ Petition:
The Court reiterated the Appeal Court's directive to dispose of the writ petition within a fortnight without fail. The respondent was directed to file the affidavit-in-opposition, and the appellant was given a timeline to prepare the affidavit-in-reply. The interim order was to continue until the writ petition's disposal, emphasizing the importance of respecting the Appeal Court's mandate. The application was ultimately disposed of, with instructions for the timely handling of the pending writ petition.