Legal Complexities in Liquor Stock Transfer Case: MP High Court Takes Strong Stance

By Abhishek Jat, Advocate

In a significant development concerning excise duty litigation, the Madhya Pradesh High Court has demonstrated a firm judicial approach in a contentious case involving disputed liquor stock transfer. The Division Bench comprising Chief Justice Suresh Kumar Kait and Justice Vivek Jain recently issued fresh bailable warrants against three signatories implicated in the controversial documentation of liquor stock receipt.

The case revolves around allegations questioning the legitimacy of documents purportedly evidencing the transfer of substantial liquor inventory to the fifth respondent. The central dispute concerns a Panchanama that documented the receipt of remainder liquor stock by three individuals who, according to contentions raised, were not authorized representatives of the fifth respondent. Adding to the complexity, one signatory was identified as a former employee of the fifth respondent, though arguments suggest the signature belongs to another person bearing the same name.

What makes this case particularly intriguing is the fifth respondent's contradictory conduct. Despite categorically denying receipt of the remainder stock, the respondent had remitted the associated excise duty. The respondent's justification for this payment cited coercion following communication from the Excise Department dated May 8, 2024, which allegedly threatened forfeiture of bank guarantees. Furthermore, the respondent acknowledged making a payment of Rs. 25 lakh to the petitioner as part of a compromise arrangement against a substantially higher demand of Rs. 1.52 crore.

The judicial bench expressed skepticism regarding this explanation, highlighting the absence of any court directive or administrative order necessitating such payment, particularly when the matter remained sub judice. Consequently, the Court ordered fresh bailable warrants valued at Rs. 25,000 each against the three signatories, directing the Superintendent of Police, Jabalpur, to ensure their appearance at the next scheduled hearing.

In a related development within the same proceedings, the Court rejected an application from the fifth respondent's senior counsel seeking retraction of observations recorded in paragraphs 9 and 10 of its previous order dated April 7, 2025. That earlier order had referred the matter to the Full Court to reconsider the senior designation of counsel following inappropriate courtroom conduct. Despite an unconditional apology being tendered for creating disruption during proceedings by responding to judicial queries with vociferous objections (behavior captured in court's live-streamed recording), the bench deemed the apology insufficient given the severity of the prior incident.

The matter has been scheduled for further judicial examination on April 17, 2025, with the Court maintaining its position on ensuring procedural compliance and appropriate courtroom decorum while addressing the substantive aspects of this excise litigation.