2016 (10) TMI 764 - HC - Central Excise

Regular bail - Section 439 of the Code of Criminal Procedure - offences punishable under Sections 9(1) (b), (bb), (bbb) and Section 9(1)(c) of the Central Excise Act, 1994 - Held that - considering the nature and gravity of accusation made against the applicant in the First Information Report and other papers as also considering the fact that the applicant is ready and willing to deposit ₹ 50,00,000/-, at this stage, without prejudice to his rights and contentions, before the concerned the Central Excise Department towards the duty leviable under the Central Excise Act, this Court is of the view that discretion is required to be exercised in favor of the applicant for grant of bail. Moreover, the applicant assures that he will abide by the terms and conditions that may be imposed by the Court and shall not commit any breach. Hence, the present application is allowed and the applicant is ordered to be released on regular bail in connection with Investigation No. INV/DGCEI/VRU/33/2016-17 conducted by DGCEI, Vadodara and registered with the Gorva Police Station, Dist Vadodara on his executing a personal bond of ₹ 10,000/- (Rupees Ten Thousand Only) with one surety of the like amount to the satisfaction of the learned Trial Court, and subject to some conditions imposed. The authorities will release the applicant only if he is not required in connection with any other offence for the time being. If breach of any of the conditions imposed is committed, the Sessions Judge concerned will be free to issue warrant or take appropriate action in the matter - application disposed off - decided in favor of applicant.

Summary

Issues involved:
Application for regular bail under Section 439 of the Code of Criminal Procedure for offences under Central Excise Act, 1994.

Analysis:

1. Nature of Allegations and Defence Arguments:
The applicant sought regular bail, claiming innocence and false implication in alleged offences related to central excise duty evasion. The applicant's counsel argued that the complainant's claim of duty evasion amounting to ?49 crores was based on presumption without concrete evidence. The applicant's medical condition, family ties, and willingness to cooperate were highlighted to support the bail plea.

2. Complainant's Submission and Investigation Findings:
The complainant alleged that the applicant, a partner in a partnership firm, was involved in clandestine manufacturing and evasion of excise duty on filtered cigarettes. The Directorate General of Central Excise Intelligence (DGCEI) raided the premises and seized goods, documents, and records for investigation. The total excise duty quantified was ?84.77 lakhs, with further presumptions of evasion amounting to ?49.90 crores.

3. Allegations under Central Excise Act, 1994:
The applicant was accused of contravening various provisions of the Central Excise Act, 1994, including manufacturing and clearing goods without duty payment, failure to assess duty, surrendering license but continuing production, lack of proper record-keeping, and clearance without proper invoices. These allegations were subject to adjudication.

4. Deposit Offer and Prosecution's Opposition:
The applicant offered to deposit ?50 lakhs towards duty liability in installments, demonstrating cooperation. The prosecution opposed bail, citing the gravity of the offence and prima facie case against the applicant.

5. Court's Decision and Bail Conditions:
Considering the accusations, the applicant's willingness to deposit the amount, and assurance of compliance, the Court granted regular bail. Bail conditions included executing a bond, surrendering passport, depositing the duty amount, reporting to the police regularly, and not leaving the state without permission. Failure to comply would result in bail cancellation.

6. Conclusion:
The Court allowed the bail application, emphasizing the need for discretion, compliance with conditions, and non-interference with the investigation. The judgment highlighted the importance of following bail terms and refraining from influencing trial proceedings based on preliminary observations during bail grant.

This detailed analysis covers the legal aspects, arguments, investigation findings, and the Court's decision regarding the application for regular bail under the Central Excise Act, 1994.