2009 (10) TMI 564 - HC - Central Excise

Arrest Power of revenue officers - Section 18 of the Act inter alia provides that all arrests made under the Act shall be carried out in accordance with the provisions of the Code of Criminal Procedure 1898 relating to arrests made under the Code. Section 13 confers a substantive power of arrest on a Central Excise Officer akin to the power conferred on the police under Sections 41 and 42 of the Code on a private person under Section 43 and on a Magistrate under Section 44 of the Code Held that - under Section 13 of the Central Excise Act empowers the Central Excise Officers to arrest a person whom he has reason to believe to be liable to punishment under the Act without issuance of warrant and without registration of an FIR or a complaint before the Magistrate

Issues Involved:
1. Whether authorities under the Central Excise Act, 1944 have the power to arrest a person under Section 13 of the Act without a warrant and without filing an FIR or lodging a complaint.
2. Whether criminal prosecution can be initiated or continued before the final adjudication by Customs & Central Excise department.

Analysis of the Judgment:

Issue 1: Power to Arrest Without a Warrant and Without Filing an FIR or Complaint
The primary issue was whether authorities under the Central Excise Act, 1944 could arrest a person under Section 13 without a warrant and without filing an FIR or complaint. The court examined the scheme of the Central Excise Act and relevant provisions, emphasizing that the main purpose of the Act is to levy and collect excise duties, with Central Excise Officers appointed to prevent duty evasion. Section 13 of the Act allows any Central Excise Officer not below the rank of Inspector, with prior approval of the Commissioner, to arrest a person believed to be liable to punishment under the Act. The court noted that Section 18 of the Act requires that all arrests be carried out in accordance with the Code of Criminal Procedure, 1898, but this pertains to the procedure of arrest rather than the substantive power to arrest.

The court referenced multiple Supreme Court decisions, including State of Punjab v. Barkat Ram and Directorate of Enforcement v. Deepak Mahajan, which clarified that Customs and Central Excise Officers are not police officers and their powers are primarily for enforcing compliance with the Act, not for investigating crimes. The court concluded that the power to arrest under Section 13 is substantive and does not require a warrant or prior filing of an FIR or complaint. The court disagreed with the Allahabad High Court's decision in Kum. Rajni and Others v. Union of India, which held that arrest under the Central Excise Act required adherence to the procedures for non-cognizable offences under the Code of Criminal Procedure.

Issue 2: Initiation or Continuation of Criminal Prosecution Before Final Adjudication
The petitioner argued that criminal prosecution could not be initiated or continued until the final adjudication by the Customs and Central Excise Department. The court observed that no criminal prosecution had been initiated against the petitioners at the time of the hearing, nor had any adjudication proceedings commenced. The court emphasized that legal questions should be decided only if they arise properly on the pleadings of a given case. Since no factual foundation regarding the initiation or continuation of prosecution during the pendency of adjudication proceedings was present, the court declined to decide this issue in vacuum.

Conclusion
The court dismissed the petition, holding that:
1. Central Excise Officers have the power to arrest a person under Section 13 of the Central Excise Act without a warrant and without filing an FIR or complaint.
2. The issue of whether criminal prosecution can be initiated or continued before final adjudication was not decided due to lack of factual foundation in the present case.

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