Writ interference over excise duty recovery notices declined where royalty tax issue remains pending and statutory refund routes apply.

Writ interference was sought against recovery notices for differential excise duty collected on royalty and stowing charges arising from coal sales under a spot e-auction scheme. The scheme required buyers to bear statutory levies and included an arbitration clause, while the status of royalty as a tax was already pending before a larger Bench of the Supreme Court. As the coal companies had deposited the differential duty with the excise authorities and any refund entitlement would have to be determined under the statutory scheme, the High Court found no basis to injunct the recovery notices at that stage and declined interference, while directing trader-wise separate statements of recoveries.

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Issues: Whether the High Court should, in exercise of writ jurisdiction, interfere with recovery notices demanding differential excise duty collected on royalty and stowing charges.

Analysis: The challenge arose in the context of coal sales under a commercial spot e-auction scheme, which expressly required buyers to bear statutory levies and contained an arbitration clause. The question whether royalty is in the nature of a tax was already pending before a larger Bench of the Supreme Court. In the meantime, the coal companies had deposited the differential excise duty with the excise authorities, and any eventual entitlement to refund would have to be worked out under the statutory scheme. In these circumstances, the Court found no basis for injuncting or interfering with the recovery notices at this stage.

Conclusion: The Court declined to interfere with the recovery notices and the connected memo, while directing maintenance of trader-wise separate statements of recoveries.

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