VEERABHADRASWARA RICE AND OIL MILL 1 4 NO 169 56 VIZIANAGARAM Vs. COLLECTOR CENTRAL EXCISE ANDHRA PRADESH HYDERABAD

JUDGEMENT

(1.) This is a petition under Article 226 of the Constitution of India to quash the order ot the Collector, Central Excise, Hyderabad dated 24-8-1958 passed in appeal filed by the petitioner before him.

(2.) The facts necessary and relevant for the disposal of this petition are briefly these:- The petitioner is a power of attorney holder of Sharaun and Co., who were the lessees of Veerabhadreswara Rice and Groundnut Oil Mills. The lessees hold a central excise licence in form L-4 for the manufacture of vegetable non-essential oils. Under Rule 47 of the Central Excise Rules, the manufacturer has to provide a store room as place of storage of the oils for the production of which he holds an appropriate licence. The petitioners firm duly declared a portion of the premises of Veerabhadreswara Rice Mill as place of storage within the meaning of Rule 47 of the Central Excise Rules.

(3.) On 20-2-1957 the Inspector of Central Excise is stated to have made a surprise visit to the premises. He found that 12 tins of nigar oil weighing 4251/2 Ibs and 12 tins of groundnut oil weighing 420 Ids were kept in a room which was neither declared nor approved as a store room for the storage of the oil as required under Rule 47(3). Thereupon the further investigation of the case was taken over by the Deputy Superintendent of: Central Excise. The Deputy Superintendent of Central Excise visited the premises in the course of his investigation and seized the 24 tins in the unapproved premises. A mahzar was prepared attesting the fact of seizure. The Deputy Superintendent in the course of further search of the premises found in a room occupied by the clerk of the petitioner, one Seetharama Sarma, two private account books relating to the purchase of oil seeds, manufacture of oil in the Mill and the disposal of that oil. Under the Excise rules, the licence-holder has to maintain certain statutory accounts including Ex. B-4 registers. The private accounts discovered in Seetharama Sarmas room were compared with thc statutory accounts lawfully maintained by the petitioners firm. It was found that the two sets of accounts did not tally and that between 1-3-1956 and 8-2-57 actually 216 tons and 1405 Ibs of vegetable non-essential oils were removed from the premises of the mill; whereas thc regular statutory accounts only showed that 156 tons and 810 Ibs were removed for sale after paying the necessary excise duty. There was thus a prima facie case that 60 tons and 593 Ibs of groundnut oils and nigar oils were removed from the declared premises otherwise than as provided under the Central Excise Rules.