PADMA KHASTGIR, J.

( 1 ) THIS is an application taken out by the plaintiff, Indian Cable Company Limited for an order of injunction restraining the defendant No. 1, Messrs. Plastic Products Engineering Company from making any demand and/or receiving any payment under the bank guarantee dated May 12, 1977 and/or taking any steps for performance of the said Bank guarantee. The petitioner has also asked for an order of injunction restraining the defendant No. 2, Punjab National Bank from making any payment or releasing any money under or in terms of the said Bank guarantee.

( 2 ) THE petitioner's case shortly is that in the year 1973 Messrs, plastic Products Engineering Co. filed a writ application in the Gujarat High Court contending, inter alia, that its products including PTFE tape were not liable to excise duty. Indian Cable purchased from Messrs. Plastic Products Engineering Company goods including PTFE tape of the total value of Rs. 17,73,031. 36 between June, 1374 and May, 1977. On June 17, 1976 the Collector of Central Excise adjudicated upon the issue in question holding that the products of M/s. Plastic Products were subject to levy of Central Excise Duty. Thereafter another writ petition was filed challenging the said order of Collector. The Bank guarantee in terms of the agreement was furnished by Punjab National Bank on behalf of Indian Cable for a sum of Rs. 5,71,991. 48. Pursuant to the agreement M/s. Plastic , Products Engineering Company called upon the Punjab National Bank to make payment in terms of the said Bank guarantee. On the 30th of Mar. 1978 the Central Excise Authorities served demand notice on Plastic Products Engineering Company for payment of excise duty of its product including PTFE sheets and tapes. Thereafter Messrs. Plastic Products Engineering Company demanded payment of Rs. 6,99,137. 78 from Indian Cable who also disputed its liability to pay as according to them no duty was payable on tapes but on sheets only. Indian Cable disputed its liability on that. Plastic products sought for some clarifications and clarifications obtained from the Central Excise Authorities (were) to the effect that the products of M/s. Plastic Products Engineering Company including PTFE sheets were liable to levy of excise duly. After that M/s. Plastic Products Engineering Company through their Advocates called upon Punjab National Bank to make payment in terms of the Bank guarantee. Indian Cable wrote to Punjab National Bank to the effect that M/s. Plastic Products were not entitled to invoke the said Bank guarantee. On 3rd of Oct. 1978 M/s. Plastic Products Engineering Company filed a suit in the Court at Ahmedabad, inter alia, for enforcement of the said Bank guarantee. On 4th of Oct. 1978 Indian Cable filed this suit and obtained an interim order. Thereafter M/s. Plastic Products Engineering Company took out an application for stay of this suit on the ground that the subject matter, parties and the reliefs claimed were identical with the suit that has been filed before the Ahmedabad Court and after hearing the parties on 4th of Feb. 1979 I pass an order staying the present suit.

( 3 ) UNDER the Bank guarantee, (i) the Bank guarantee would remain in force till the writ petition is finally disposed of by a Court of law but not later than one year from the date of the guarantee, i. e. 5th Apr. 1978; (it) the Bank guarantee shall be enforceable against the Bank for the amount of excise duty actually paid by the Manufacturer; (in) The Manufacturer is entitled to recover from the purchaser the amount of excise duty as finally assessed. All other terms would appear from the said guarantee Bond.

( 4 ) THE said writ petition was disposed of on 23rd of June, 1977, as such the defendant had called upon the Bank to make payment. But the plaintiff has taken the stand that PTFE tapes were not excisable products; as such they refused to pay and the plaintiff also wrote to the defendant Bank that the guarantee could not be enf

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