VARUN PROCESSORS (PVT.) LTD. Vs. UNION OF INDIA

JUDGEMENT

(1.) THIS part of heard case is being adjourned on the request of the petitioner's counsel since 27th August, 1993. Earlier also several adjournments were granted and on 11th December, 1992 the order passed was that no further adjournment shall be granted. Sh. P.C. Goyal, counsel for the petitioner is again not present to-day. Further proceedings before the trial court in this case were stayed as far as back on 7th October, 1991. There is thus no other option but to decide this case in his absence, after perusal of the record.

(2.) THIS petition under Section 482 of the Code of Criminal Procedure read with Central Excise and Salt Act, 1944 and Rules made thereunder, relates to quashment of complaint filed by the Assistant Collector, Central Excise, Ministry of Finance, Department of Revenue, Amritsar, against the present petitioners under Sections 9 and 9-A of the Central Excise and Salt Act read with Rules 9(1), 52(A), 173(G) and 226 of the Central Excise Rules 1944 and consequent proceedings taken thereunder by the C.J.M. Amritsar. According to the complainant-respondent M/s Varun Processors Pvt. Ltd. Company is a private limited concern working through its Directors namely Tarlok Chand Khanna and Rakesh Khanna and they are amenable to penal action as they were incharge and responsible for the conduct of the business of the said company and the offences complained against the accused have been committed with their consent or connivance and is attributable to their neglect. The said accused are responsible for all acts of omissions or commissions on behalf of the company including penal liabilities under the provisions of the law as the said Company is being run, controlled, managed and supervised by the said accused directly or indirectly for all purposes including accounts, all profits and losses and all payments to various Central Excise duties, maintenance of statutory records and other liabilities under the provisions of the Central Excise Law. It was further pleaded that on 1.8.1987 acting on information that the aforesaid company through its Directors (the present petitioners) is engaged in the manufacturing of processed man-made fabrics and they are clearing the said goods without payment of Central Excise Duty. A contingent of Central Excise Officials including P.Ws visited the above said premises. Rakesh Khanna accused was present in the factory at that time. On demand he produced the Central Excise as well as the other records. Stock of the finished man-made fabric as well as grey fabric was physically checked by the officials of the Central Excise Department. On physical verification stock of 2854.71 Sq. Mtrs. of processed man-made fabric was found in excess of the quantity shown in the RG-1 register for which no entry existed even in the Grey register. The said fabrics bear the lot number already allotted to other fabrics. The company has also not got approved the price list and classification list of the said fabrics from the department. On query Rakesh Khanna told the inspecting staff that lots No. 578 and 589 were put by them by mistake though it was not the same fabric as they had received under lot No. 578, were of the composition of 100 polyester, weft 48 x 52 poly cotton by the goods actually found bearing lot No. 578 were of the composition of Warf 100 polyester. Similarly, goods originally received under lot No. 589 was of the composition of warf and weft 48 x 52 by 48 x 52 polyester/cotton but the goods found on physical verification bearing lot No. 589 were of the composition of 100% polyester. The goods of lot No. 129 were found short than shown in the Central Excise records. The goods originally received under lots No. 129, 578 and 589 were found short in the stock and believed to have been cleared without issuing G.P.1 and the same quantity of grey fabrics have been replaced by allotting the same lot numbers. The finished goods bearing lot No. 16 was found in excess of the quantity shown in the grey-RG-1 registered and was found lying unaccounted for in the statutory record of the factory reasonably believed to be liable for confiscation. It was next pleaded that the said company tendered a voluntary written statement immediately after the seizure in which the manner and factum of recovery was admitted.

(3.) WHILE dealing with the inherent powers of this Court for quashment of proceedings, it was observed by the Lordships of the Hon'ble Supreme Court in State of Bihar v. Murad Ali Khan, AIR 1989 SC 1, as under :-