Castrol India Ltd. vs Union of India (UOI)

K. Mohan Ram, J.—By consent, the main writ petition itself is taken up for final disposal.

The prayer in this writ petition is for the issuance of writ of certio-rarified Mandamus to call for the records culminating in the impugned

communication dated 20-3-2006 bearing No. C. No. IV/16/9/04 Prov. Asst. (PF) issued by the third respondent to the fourth respondent herein

and to forbear the first and the third respondents from initiating any coercive action against the petitioner so as to recover the alleged dues either by

invocation of the Bank Guarantees bearing Nos.-5021174681, 5021174682, 5021174683 all dated 27-4-2002 and 240GT02031504528 dated

30-5-2003 or otherwise and consequently, restrain the fourth respondent from paying any amounts under the aforementioned Bank Guarantees to

the first and the third respondents and /or any other person claiming through or under them.

Heard both sides.

The short facts that are necessary for disposal of the writ petition are as follows:

Against the order in original Nos. 4/2005 dated 1-3-2005, 5/2005 dated 1-3,2005 and 7/2005 dated 29-4-2005 respectively, the appeals were

filed by the petitioner before the Commissioner of Central Excise (Appeals), Chennai-34 in A. Nos. 61, 62 and 87/2005 (M-l). The said appeals

were disposed of by the common order in A. Nos. 61, 62 and 87/2005 (M-l) dated 7-2-2006, rejecting the appeals filed by the petitioner.

Subsequent to the order passed by the Commissioner of Central Excise (Appeals), Chennai-34, the third respondent herein viz., Assistant

Commissioner of Central Excise (Apeals), Chennai-34, by his proceedings in C. No. IV/16/9/04 Prov. Asst. (PF) dated 20-3-2006, sought to

enforce the Bank Guarantees executed by the petitioner so as to realise the dues. The said proceedings dated 20-3-2006 are impugned in the

above writ petition.

Admittedly, against the order passed by the Appellate Authority, a statutory appeal lies to the CESTAT. In fact, the petitioner, in his affidavit

filed in the above writ petition, has stated that he is in the process of filing an appeal against the order of the appellate authority. It is the case of the

petitioner that until the statutory period for filing an appeal expires, the Department would not be entitled to initiate recovery proceedings. Since the

Assistant Commissioner of Central Excise/the third respondent has sought to invoke the Bank Guarantees pending filing of the appeal by the

petitioner, the above writ petition has been filed.

Mr. V.T. Gopalan, learned Additional Solicitor General of India, submits that for the purpose of getting an interim order, the writ petition cannot

be filed, when an effective alternative statutory remedy of appeal is available to the petitioner. In support of the said contention, the judgment of this

Court rendered in Collector of Customs, Madras Vs. Madras Electro Castings P. Ltd., is relied upon. At page 650 of the said decision, it has

been held as follows:

It is a settled position of law that jurisdiction under Article 226 of the Constitution of India cannot be exercised to circumvent or bypass the remedy

of statutory appeal and only for the purpose of granting a relief of an interim nature, without deciding the subject matter of the dispute. Further, an

interim relief can be granted to preserve in status quo the rights of the parties, so that the proceedings do not become infructuous by any unilateral

overt acts by one side or the other during its pendency of the proceedings (See Shri Kihota Hollohon Vs. Mr. Zachilhu and others, .

The law laid down in the above decision of the Division Bench squarely applies to the facts of this case. There is no dispute as pointed out

above that an appeal remedy is available to the petitioner and in fact, the petitioner is in the process of filing an appeal and instead of approaching

the Tribunal to get interim orders, the above writ petition filed by the petitioner cannot be entertained. Therefore, the above writ petition fails and

the same is dismissed. No costs. Consequently, WPMP No. 9706 of 2006 is also dismissed.

However, the learned counsel for the petitioner submits that the petitioner is still having time to prefer the appeal before the Tribunal and in the

mean time, if the Bank Guarantee is invoked by the respondents, the petitioner will be put to great hardship and loss and hence, he seeks time to

file the appeal on or before 15-5-2006 and till then, he submits that the respondents may be directed not to invoke the Bank Guarantee.

The learned Additional Solicitor General fairly submits that the respondents will not invoke the Bank Guarantee for a period of two weeks from

today and the petitioner may be directed to file an appeal in time.

Considering the above said submissions, the following direction is passed:

The petitioner shall file an appeal before the CESTAT on or before 15-5-2006 and if so advised, move appropriate application before the

CESTAT for any interim relief, which is available to them in law, before 15-5-2006 and until such time, the respondents shall not invoke the Bank

Guarantees executed by the petitioner. Thereafter, it is open to the respondents to proceed further in the matter subject to any interim order that

may be passed by the CESTAT.