TMI Blog2005 (4) TMI 83X X X X Extracts X X X X X X X X Extracts X X X X ..... th encash the bank guarantee of Rs. 15 crore of HSBC Bank given by M/s. Noble Asset Co. Ltd. to secure the amount of fine. In addition to this, a demand for duty of Rs. 7,89,53,162/- also came to be confirmed against the petitioner. The petitioner also prayed for direction against the respondent No. 2 not to encash the bank guarantee pending disposal of stay application to be filed by the petitioner before the Central Excise and Service Tax Tribunal (the 'Tribunal' for short). 2.During the course of hearing, learned Counsel appearing for the petitioner submitted that though the petitioner claims wider relief but petitioner desires to restrict to a relief in the nature of direction against respondent No. 2 not to encash bank guarantee date ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 05 (Bom.); wherein this Court had ruled that it was highly improper on the part of the Collector and Assistant Collector to encash the bank guarantees before expiry of the statutory period of three months available for filing appeal. The Division Bench of this Court in this case had to direct the respondent Nos. 2 and 3 to return the entire amount recovered by them through encashment of bank guarantees to the petitioners within 10 days from the date of the order. 6.On the similar lines, the view taken by the Delhi High Court in the case of N.G. Enterprises v. Commissioner of Customs (Appeals), New Delhi, 2002 (144) E.L.T. 512 (Del.), was also brought to our notice wherein the High Court of Delhi did not permit coercive recovery till appea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en of a nationalised bank, prima facie; does not hold water looking to the conduct of the Revenue, who has not only accepted the said bank guarantee of a foreign bank but has also acted upon the same by provisionally releasing the rigs. 11.The bank guarantee was furnished somewhere in the month of May 2001. Till this date i.e. till 2005, at no point of time any objection was raised to the quality or to the validity of the bank guarantee by the Revenue. Thus, submission made in this behalf is misplaced. 12.So far as the removal of the rigs outside India is concerned, it was well within the knowledge of the Revenue. At no point of time in past four years complaint was made by the Revenue in this behalf. In this view of the matter, the sub ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urt consisting of Justice Kurdukar and Justice Kapadia had also occasion to consider the similar question in the case of Mahindra and Mahindra cited (supra); wherein the encashment of bank guarantee during the appeal period was set aside and the Revenue was made to refund the proceeds of the bank guarantee. 15.In this view of the matter, in our considered view, the petitioner is entitled to have limited direction against the respondent No. 2 not to encash bank guarantee until the appeal along with application for stay or to dispense with pre-deposit is moved by the petitioner before the Tribunal. The petitioner undertakes to move the appellate authority i.e. Tribunal within four weeks from today. Statement made in this behalf is taken on ..... X X X X Extracts X X X X X X X X Extracts X X X X
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