2006 (1) TMI 144 - HC - Central Excise

Summary

Issues:
1. Writ petition to restrain recovery of arrears of Central Excise Duty.
2. Validity of demand raised based on Tribunal's order.
3. Contention regarding ex parte nature of Tribunal's order and demand notice.

Analysis:
1. The writ petition was filed to prevent the first respondent from collecting arrears of Central Excise Duty as per a communication dated 24-11-2005 by the Deputy Commissioner of Central Excise, confirmed by the Customs Excise and Service Tax Appellate Tribunal in final order No. 825/05 dated 9-6-2005. The petitioner sought a writ of Mandamus against this recovery.

2. The Customs, Excise and Service Tax Appellate Tribunal, Chennai, allowed the appeal by the Commissioner of Central Excise against a previous order. Subsequently, the first respondent issued a demand on the petitioner based on this Tribunal's order. The petitioner argued that the Tribunal's order was ex parte, and they were unaware of it until receiving a demand notice. However, the court held that since there was no stay against the Tribunal's order, the first respondent was within their rights to demand payment of the duty. The court deemed the demand legal and denied the petitioner's contention to restrain it.

3. The petitioner claimed that the Tribunal's order was ex parte, and they had an application pending to set it aside. They argued that the demand notice should not have been issued while the application was pending. The court found this argument untenable, stating that the liability to pay the duty was established by the Tribunal's order, and in the absence of a stay, the first respondent had the right to demand payment. As the petitioner failed to make a case for the writ, the court dismissed the petition and closed the connected application.

This judgment clarifies the legal principles regarding the enforcement of Tribunal orders and the entitlement of authorities to demand payment of duties in the absence of a stay order. It emphasizes the importance of complying with tribunal decisions and the limited grounds on which recovery actions can be restrained through writ petitions.