SUMMONS ISSUED BY EXCISE OFFICERS DOES NOT DEPRIVE INDIVIDUAL LIBERTY

[Mr. M. GOVINDARAJAN]

Sec. 14 of the Central Excise Act deals with the power to summon persons to give evidence and produce documents in inquiries under the Act. This section provides that any Central Excise Officer, duly empowered by the Central Government, in this behalf, shall have power to summon any person whose attendance he considers necessary either to give evidence or to produce a document or any other thing in any inquiry which such officer is making for any of the purposes of this Act. A summons to produce documents or other things may be for the production of certain specified documents or things or for the production of all documents or things of a certain description in the possession or under the control of the person summoned.

All persons so summoned shall be bound to attend, either in person or by an authorized agent as such officer may direct; and all persons so summoned shall be bound to state the truth upon any subject respecting which they are examined or make statements and to produce such documents and other things as may be required.

Provided that the exemption under Sec. 132 and 133 of the Code of Civil Procedure, 1908 shall be applicable to requisites for attended under this section. Every such inquiry aforesaid shall be deemed to be a judicial proceeding within the meaning of Sec. 193 and Sec. 228 of the Indian Penal Code.

Madras High Court, Madurai Bench held that an Excise Officer issuing summons to appear with records could not be 'deprivation' of liberty of an individual liberty (as reported in Business Line, dated 26.10.2010). In this case writ petitions were filed by the partners of a Virudhunagar based company, V.V. Vanniaperumal & Sons, challenging the summons dated 28.10.2010 issued by the Superintendent, Office of the Commissioner, Central Excise, Madurai.

The petitioners contended the following before the High Court:

The  Central Board of Excise and Customs had issued a circular that person appearance need not be insisted upon and hence it was unnecessary to appear;

There was no requirement in law to appear on summons when the petitioners themselves could depute a person who was familiar with their accounts to make clarification to the Officers;

The summons impugned was totally uncalled for and nothing but harassment.

The High Court was unable to accept the contentions advanced by the petitioners. Under the Central Excise Act no proceeding had been initiated and the petitioners had come before this court even before any statutory proceedings to culminate into a concrete finding. Their only problem was that they did not want to appear before the Officer for inexplicable reasons. The Court did not find any ground to forestall the summons unless there was a deprivation of liberty guaranteed under Article 21 of the Constitution.

The Court held that even while dealing with the power of search and seizure provided under the Income Tax Act, when a challenge was made about the likelihood of abuse of power by the authorities, a Constitution Bench of the Supreme Court had rejected such contentions in 'Pooran Mal V. Director of Inspection'- 2008 -TMI - 6426 - SUPREME Court. Therefore in the interest of the community, it is only right that the fiscal authorities should have sufficient powers to prevent tax evasion.

The Court further observed that it could be presumed that it was for egoistic reasons and not on any concrete legal foundation. Under such circumstances the writ petitions were misconceived and hence the Court dismissed the same.