STATE Vs. K M GOPAL

JUDGEMENT

(1.) APPEAL under Section 378(4) of the Code of Criminal Procedure, 1973 against the acquittal of the aforesaid Respondent Nos. 1 & 2 in each of the appeals (Accused Nos. 1 & 2) of an offence of A. I. (C. A. 528/75) offence under Rules 173(8)(1)(2)(4) read with Rules 173(a)(b) & (d) and Rule 52 (A) of the Central Excise Rules, 1944 and under Sections 9(a), 9(b) and 9(d) of the Central Excises and Salt Act, 1944 These appeals coming on for hearing on Monday the 23rd and Monday the 30th day of January, 1978 upon perusing the petitions of APPEAL and the record of the evidence and proceedings before the said lower Court and upon hearing the arguments of Mr. Habibullah Badsha, Central Govt. Prosecutor on behalf of the Appellant in both the appeals and of Mr. A. Nagarajan, Advocate for the respondent Nos. 1 and 2 in each of the APPEAL (Accused Nos. 1 & 2) and having stood over for consideration till this day, the court delivered the following Judgment. Criminal APPEAL No. 528 of 1975 is an appeal preferred by the State represented by the Asst. Collector of Central Excise, Vellore against the order of the judicial Second Class Magistrate of Gudiyatham in C. C. No. 592 of 1973 acquitting the two accused-respondents K. M. Gopal and T. P. Velayutham under Sec. 245(1) Cr. P. C. Criminal APPEAL No. 529 of 1975 is a similar appeal preferred by the State represented by the Asst. Collector of Central Excise, Vellore against the order of the learned Judicial Second Class Magistrate, Gudiyatham in C. C. No 591 of 1973 acquitting the accused-respondents K.M. Mahalingam and T. P. Velayutham under Section 245(1) of the Criminal Procedure Code. Two separate complaints were laid by the State represented by the Assistant Collector of Central Excise, Vellore against the respondents in both the appeals for offence under Sections 9(a) (b) and 9(d) of the Central Excises and Salt Act of 1944 and Rules 173 G(1)(2) and (4) read with Rules 173 Q(a)(b) and (3) and Rule 52-A of the Central Excise Rules, 1944.The material allegations in the complaint were as follows :-

(2.) THE accused in C.C. No. 591 of 1973 who is the first respondent in C.A. No. 529 of 1975 is running a match factory at Gudiyatham under the name and style of Mohan Match Industries under a valid licence issued by the Central Excise Department at premises No. 73 Mailpatti Road, Cheruvanju village in Gudiyatham taluk while the first accused in C. C. No. 592 of 1973 who is the first respondent in C. A. No. 528 of 1975 is running a match factory at Gudiyatham under the name and style of Gopal Match Industries at No. 3, Sannadhi St., Nellorepet, Gudiyatham under a valid licence issued by the Central Excise Department. Both the aforesaid match factories were using an approved trade label 'chank' on the matches manufactured by those factories. THE Gudiyatham Match Industries was also using the same trade label and it was with the consent of the Gudiyatham Match Industries that the aforesaid match factories were using the same label. THE second accused both in C. C. No. 592 of 1973 and C. C. No. 593 of 1973 who is second respondent both in C. A. No. 528 of 1975 and C. A. No. 529 of 1975, is a saleman working in the Gudiyatham Match Industries and is also the Prop. of M/s. Moorthy Traders at Gudiyatham and he was being used for moving out the matches manufactured by the aforesaid factories to outside agencies in a van bearing registration No. MSY 5229 belonging to M/s. Gudiyatham Match Industries and in a van bearing registration No. TNJ 337 belonging to M/s. Gopal Match Factories. On 29-8-1972, the Superintendent of Central Excise, Hqrs. Prev. Madras along with other Central Excise Officers intercepted the van TNJ 337 driven by one Ramalingam, the driver of M/s. Gudiyatham Match Industries at Chettupattu in North Arcot Dist. THE van was found to contain 265 bundles of matches and had the 'chank' label. THEse matches were despatched from the depot of the second accused who was also seated in the van. When those 265 bundles of matches found in the van were examined, it was found that 20 of those bundles related to M/s. Gudiyatham Match Industries, 170 of those bundles belonged to M/s. Gopal Match Industries and 75 of the bundles belonged to M/s. Mohan Match Industries. THE van driver produced a letter given by M/s. Moorthy Traders of which the second accused in both the cases, was the proprietor. That letter showed a despatch of 275 bundles in the van but actually only 265 bundles were found in the van. Since the shortage of 10 bundles was not adequately explained, the van was taken to Pondicherry and a probe was made when it was noticed during the probe that the bundles with serial numbers far ahead of the Sl. Nos. found on the 265 bundles were available in the market already. In the case of Sl. Nos. 583, 581 and 608 noticed on some of the bundles, wrappers with those Sl. Nos. were noticed in three shops at Villianoor. THE Superintendent of Central Excise, Hqrs. Prev., Madras had thus round that some of the bundles in the van had the same serial numbers as some bundles which had already been supplied and gone into circulation in the market. Hence the entire consignment of 265 bundles of matches were seized by the Superintendent on a reasonable belief that in respect of that consignment, duty had not been paid. A statement was also recorded from the 2nd accused in the presence of witnesses. During the course of further investigation, it was found that the first accused had supplied match bundles manufactured at his factory bearing identical serial numbers to different dealers. A check of distributors and retail dealers also resulted in the recovery of the match wrappers as well as full match bundles which bore numbers identical with those numbers found on the 265 bundles seized from the van. THErefore, the first accused had thus removed from his factory premises bundles of matches bearing 'Chank' labels bearing the same identical serial nos. without a gate-pass and without payment of duty to the Central Government and without debiting the amount of the duty in the statutory registers maintained at his factory and he did so with the aid and connivance of the first accused and that thereby the first accused in both the cases have contravened Rules 173F, 173G(1)(2) and(4) read with Rule 173-Q 9(a), (b) and (d) and 52A of the Central Excise Rules, and Section 9(a) and (b) of the Central Excises and Salt Act, 1944 while the 2nd accused in both the cases has contravened Rule 52-A of the Central Excise Rules, 1944 and Section 9(d) of the Central Excises and Salt Act of 1944.

(3.) IT cannot be and is not seriously disputed that on 29-8-72 a van TNJ 337 belonging to M/s. Gopal Match Factories and driven by one Ramalingam, a driver of the Gudiyatham Match Industries was intercepted when it was carrying 265 bundles of matches. The prosecution case is that all these 265 bundle of matches had been removed from the factories of the first accused in both these cases without payment of excise duty and without gate-passes in order to evade the payment of excise duty on them. The prosecution has tried to prove the offence alleged against the accused by means of circumstantial evidence and in a circumlocutus manner. They have attempted to show that in these 265 bundles the Sl. Nos have been given which are identical with the Sl. Nos. of bundles of matches already removed from the factory and supplied to the market and that, in other words, in order to evade the payment of excisable duty in respect of these 265 bundles the first accused in both the cases had stamped the same serial numbers on those bundles as the serial numbers already given to bundles which had already been removed from the factories after payment of excise duty, so that if these bundles have come to the notice of the excise authorities, the excise authorities may be misled into believing that excise duty had already been paid in respect of these bundles of matches. After noticing these 265 bundles in the van, the excise authorities conducted a probe. They went to various places and seized certain wrappers as well as bundles of matches. From the shop of P W 4 the wrapper bearing serial No. 583 (M.O. 266) was recovered and from P W. 4 a statement Ex. P. 5 was recorded. From PW 2 a wrapper with serial No. 581 (M. O. 267) was recovered and Ex. P. 6 was recorded from him. From the shop of PW 3 a wrapper M. O. 268 bearing Serial No. 608 was recovered and a statement Ex. P. 7 was recorded. P. W. 3 however did not support the case of the prosecution and he was treated as hostile. From P. W. 5 a wrapper M. O. 269 bearing serial No. 578 was recovered and a statement Ex. P. 13 recorded from him. From PW 7 a wrapper MO 277 bearing serial No 587 was recovered and the statement Ex P. 17 was recorded from him. From P. W. 8 a wrapper MO. 278 bearing serial No. 573 was recorded and his statement Ex P. 18 was recorded. But P. W. 8 did not support the case of the prosecution and he was treated as hostile by the prosecution. From P.W. 16) a wrapper MO 279 bearing serial No. 621 was recovered and the statement Ex. P. 19 was recovered from him.