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2016 (7) TMI 1342 - BOMBAY HIGH COURTValuation - includibility - Whether additional (differential) Central Excise duty paid by adding “Royalty” and “Stowing Excise Duty” as components for determining the transaction value defined in Section 4(3) of the Central Excise Act, 1944 by the WCL to the Excise Department of the Union of India can be recovered by it from the Petitioners? Held that: - we, at this stage, do not find that any illegal recovery is being forced upon the petitioners before us as its legality or otherwise is contingent upon the nature of “royalty” - an issue still pending before the Hon’ble Apex Court itself. The amount of differential Excise duty is already paid on behalf of the petitioners by the respondent WCL and hence, it has to recover it from them. It does not need any authorization for said purpose from its Holding Company. Amount recovered by WCL is and will always be safe. If the Hon’ble Apex Court answers the controversy in favour of the petitioners, they can claim its refund as per law either from WCL or from the Union of India, with such interest from either of them as the law may permit. There is nothing before us to demonstrate that any highhanded action is being resorted to by the respondents for effecting said recovery. Whether in these facts, WCL committed any wrong in paying the differential amount of Excise duty? Whether such payment binds these petitioners? If not, Whether petitioners independent of pending reference before the Nine Judges of the Hon’ble Apex Court, can still oppose its recovery from them? - Held that: - The only effort of the petitioners has been to demonstrate that pendency of that reference has no bearing and till its adjudication, the law in force needs to be enforced. This effort is apparently misconceived and they cannot succeed with such an argument, in present facts. Moreover, this contention and the plea that they cannot now recover this differential Excise duty from their purchasers or consumers, at the most indicate breach of a contractual term which in present facts, is amenable to arbitration. The understanding of a legal provision and position by the WCL, its notice dated 22/25-3-2011 in this regard, its impact in law on civil rights of parties and claims (if any) arising therefrom, are all the disputes arising under the non-statutory contract and forum of arbitration is accepted therefor by the petitioners. It cannot be said that reliefs sought in these writ petitions do not emanate from the contract between the parties. For period beyond 1-3-2013, Excise duty is being paid by these petitioners accepting “Royalty” and “Stowing Excise Duty” as components of the transaction value. We feel that the public money needs to be secured first. We also find that it will be more safe with the respondent WCL than any of the petitioners. If ultimately, this amount of differential Excise duty is held not due or recoverable from them, the petitioners can seek its refund as per law by filing such proceedings in appropriate forum against necessary parties, as they may be advised. They may also seek due interest or suitable damages from them, if claim for the either is sustainable in law. There is no irreparable loss to them & no question of any balance of convenience in their favour. Petition dismissed.
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