Granting bail to the Essar director (finance), Shishir Aggarwal and general manager (accounts), PR Ashok, the single member bench comprising Justice RP Dholakia let Essar off the hook maintaining that the case of duty evasion made out against the company was not correct since the equipment worth over Rs 700 crore imported by the company for its Rs 11,000 crore refinery project in Jamnagar was not "smuggled goods."

It may be mentioned that ever since the DRI declared war on Essar for duty evasion in March this year, the company has been arguing that since the duty on equipment was hiked after Essar had issued a cheque of Rs 60 crore by way of payment of duty, a case fordelayed payment or short payment could be made against the company and not one of duty evasion.

For Essar, the senior counsel was none other than legal luminary and political heavyweight, former commerce minister P Chidambaram who appeared before the Gujarat high court on Monday. The argument taken by him was that the attitude adopted by the DRI was not only detrimental for the state but for the country as well as it would detract investors from coming forth with any concrete developmental proposals for the state.

On his part, the judge while granting bail to the two Essar officials who were arrested about ten days ago on charges of duty evasion, stated that the two would have to submit copies of their passports but would not be restricted from travelling abroad provided the court was intimated. In addition, they were asked to furbish personal securities of Rs 5 lakh each within a month.

The court also instructed Essar to pay the balance Rs 32 crore duty following the increase in duty affected in thebudget in three instalments. The company has been asked to pay Rs 6 crore this month and Rs 12.5 crore each in the following two months.