Slice the duck breasts diagonally into 2cm/1in thick slices, and put them in a shallow non-reactive dish.
Put the chillies, vinegar, garlic, ginger and mustard seeds in a blender or food processor, and purée to a smooth paste. Stir the ground coriander, cumin and turmeric into the paste.
Pour this spice mixture over the duck slices, and mix until they are evenly coated. Cover and leave to marinate for 3 hours at room temperature or overnight in the refrigerator.
Heat the oil in a heavy saucepan. Remove the duck from the marinade, reserving the marinade, and add the duck to the pan with the salt. Cook over a gentle heat for 5 minutes, then pour away any excess fat from the pan. Add the reserved marinade and 150ml/5fl oz water, and stir well. Cover and simmer, stirring, for 30 minutes or until the duck is tender.
Stir in the sugar, increase the heat and cook the vindaloo over a medium-high heat for 6–8 minutes, stirring frequently to prevent it sticking. The sauce should be of a thick coating consistency. Serve hot with basmati rice.