2017 (5) TMI 1250 - HC - Central Excise

Maintainability of criminal revision petition - Clandestine removal of excisable goods - The rejection of bail in a non-bailable case at the initial stage and the cancellation of bail already granted, have to be considered and dealt with on different basis - Held that - It is not the case of the Department that the Magistrate had no jurisdiction to grant the bail. If the offence u/s 9 of the CEA would have been punishable with life imprisonment, then it could definitely be argued that the Magistrate had no jurisdiction to grant bail. Generally speaking, the ground for cancellation of bail, broadly (the illustrative and not exhaustive) are interference or akin to interference with the due course of administration of justice or evasion or attempt to evade the due course of justice or abuse of the concession granted to the accused in any manner - the revisional court committed an error in passing the impugned order and cancelling the bail granted by the learned Judicial Magistrate, Rajkot to the applicants - application allowed.

Issues Involved:
1. Maintainability of the criminal revision application.
2. Jurisdiction of the Sessions Court to cancel bail.
3. Grounds for cancellation of bail.
4. Compliance with bail conditions and payment of evaded excise duty.

Detailed Analysis:

1. Maintainability of the Criminal Revision Application:
The primary issue addressed was whether the criminal revision application filed by the Department was maintainable. The court held that "the orders granting bail or refusing bail are interlocutory orders." The Supreme Court's decision in *Usmanbhai Dawoodbhai Memon v. State of Gujarat* (1988) was cited, which stated, "It cannot be doubted that the grant or refusal of a bail application is essentially an interlocutory order." The Bombay High Court in *Mohan alias Mannu Basantani v. State of Maharashtra* (1989) and *The State of Maharashtra v. Namdeo Raoji and others* (1991) also supported this view, ruling that such orders are interlocutory and thus not subject to revision under Section 397(2) of the Cr.P.C.

2. Jurisdiction of the Sessions Court to Cancel Bail:
The court found an inherent lack of jurisdiction on the part of the Sessions Court in entertaining the criminal revision application. It was noted that if the Sessions Court wanted to cancel the bail, it should have done so under Section 439(2) of the Cr.P.C., which allows for the cancellation of bail already granted. The court emphasized that "the considerations would differ and vary" between initial bail rejection and subsequent bail cancellation, requiring "very cogent and overwhelming circumstances" for the latter.

3. Grounds for Cancellation of Bail:
The court elaborated that bail once granted should not be canceled mechanically. It stated that grounds for cancellation include "interference or akin to interference with the due course of administration of justice" or "abuse of the concession granted to the accused." The court cited *Dolat Ram And Others Vs. State of Haryana* (1995) to emphasize that supervening circumstances must render it no longer conducive to a fair trial to allow the accused to retain his freedom.

4. Compliance with Bail Conditions and Payment of Evaded Excise Duty:
The court noted that the applicants had already deposited ?2.62 crore with the Department and had committed to paying the remaining ?95 lakh in equal monthly installments of ?10 lakh. It was highlighted that the exact liability would be determined through adjudication proceedings as prescribed by the Act. The court affirmed the bail granted by the Chief Judicial Magistrate, Rajkot, and directed the applicants to comply with the terms and conditions laid down, including the monthly installment payments, without prejudice to their rights and contentions.

Conclusion:
The court concluded that the Sessions Court erred in canceling the bail granted by the Chief Judicial Magistrate, Rajkot. The impugned order was quashed, and the bail order was affirmed. The applicants were directed to comply with the bail conditions and continue their installment payments. The application was disposed of, and the rule was made absolute to the specified extent.

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