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TMI Blog2011 (9) TMI 65X X X X Extracts X X X X X X X X Extracts X X X X ..... tion 9A of the 1944 Act and Section 104(4) of the Customs Act, 1962, provide that notwithstanding anything in the Code of Criminal Procedure, offences under both the Acts would be non-cognizable - offences under Section 135 of the Customs Act, 1962, are bailable and if the person arrested offers bail, he shall be released on bail in accordance with the provisions of sub-Section (3) of Section 104 of the Customs Act, 1962, if not wanted in connection with any other offence - 66 of 2011, 85 of 2010 - - - Dated:- 30-9-2011 - Altamas Kabir, Cyriac Joseph, Surinder Singh Nijjar, JJ. JUDGEMENT Per: Altamas Kabir: 1. Two sets of matters have been heard together, one relating to the provisions of the Customs Act, 1962, and the other involving the provisions of the Central Excise Act, 1944, since the issue in both sets of matters is the same. The common question in these two sets of matters is that since all offences under the Central Excise Act, 1944 and the Customs Act, 1962, are non-cognizable, are such offences bailable? Although, the provisions of both the two Acts in this regard are pari materia to each other, we shall first take up the matters relating to the Central ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... th sets of matters, submitted that since the expressions cognizable or non-cognizable or even bailable offences had not been defined in either the 1944 Act or the Customs Act, 1962, one would have to refer to the provisions of the Code of Criminal Procedure, 1973 (Cr.P.C.) to understand the meaning of the said expressions in relation to criminal offences. Section 2(a) Cr.P.C. defines bailable offence as follows :- 2(a). bailable offence means an offence which is shown as bailable in the First Schedule, or which is made bailable by any other law for the time being in force; and non-bailable offence means any other offence; Section 2(c) defines cognizable offence as follows:- 2(c). cognizable offence means an offence for which, and cognizable case means a case in which, a police officer may, in accordance with the First Schedule or under any other law for the time being in force, arrest without warrant; Section 2(l) defines non-cognizable offence as follows:- 2(l). non-cognizable offence means an offence for which, and non-cognizable case means a case in which, a police officer has no authority to arrest without warrant; 5. Mr. Ro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reads as follows :- 18. Searches and arrests how to be made .- All searches made under this Act or any rules made thereunder and all arrests made under this Act shall be carried out in accordance with the provisions of the Code of Criminal Procedure, 1973 (2 of 1974), relating respectively to searches and arrests made under that Code. 9. Sections 19, 20 and 21 deal with how a person arrested is to be dealt with after his arrest and the procedure to be followed by the Officer in-Charge of the police station concerned to whom any person is forwarded under Section 19. For the sake of understanding the Scheme, the provisions of Sections 19, 20 and 21 of the 1944 Act are extracted hereinbelow ad seriatim :- 19. Disposal of persons arrested - Every person arrested under this Act shall be forwarded without delay to the nearest Central Excise Officer empowered to send persons so arrested to a Magistrate, or, if there is no such Central Excise Officer within a reasonable distance, to the officer-in-charge of the nearest police station. 20. Procedure to be followed by officer-in-charge of police station .- The officer-in-charge of a police station to whom any per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to be kept by such officer in such form as the State Government may prescribe in this behalf, and refer, the informant to the Magistrate. (2) No police officer shall investigate a non-cognizable case without the order of a Magistrate having power to try such case or commit the case for trial. (3) Any police officer receiving such order may exercise the same powers in respect of the investigation (except the power to arrest without warrant) as an officer in charge of a police station may exercise in a cognizable case. (4) Where a case relates to two or more offences of which at least one is cognizable, the case shall be deemed to be a cognizable case, notwithstanding that the other offences are non-cognizable. 11. As will be evident from the aforesaid provisions of Section 155 Cr.P.C, no police officer in charge of a police station is entitled to investigate a non-cognizable case without the order of a Magistrate having the power to try such case or to commit the case for trial. Furthermore, no such police officer is entitled to effect arrest in a non-cognizable case without a warrant to effect such arrest. According to Mr. Rohatgi, since all offences under the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gi will have to be considered in the context of the provisions of Sections 9A , 13 and 18 to 21 of the 1944 Act and Section 155 Cr.P.C . 14. Section 41 of the Code provides the circumstances in which a police officer may, without an order from a Magistrate and without a warrant, arrest any person. What is relevant for our purpose are Sub-section (1)(a) and Sub-section (2) of Section 41 which are extracted hereinbelow :- 41. When police may arrest without warrant .- (1) Any police officer may without an order from a Magistrate and without a warrant, arrest any person- (a) Who has been concerned in any cognizable offence, or against whom a reasonable complaint has been made, or credible information has been received, or a reasonable suspicion exists, of his having been so concerned; or (b)to (h) (2) Any officer in charge of a police station may, in like manner, arrest or cause to be arrested any, person, belonging to one or more of the categories of persons specified in section 109 or section 110. 15. An exception to the provisions of Section 41 has been made in Section 42 of the Code which enables a police officer to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... officer or at any stage of the proceeding before a Court to give bail, he shall be released on bail. In other words, in respect of a non-cognizable case, a person who is arrested without warrant shall be released on bail if he is prepared to give bail. The scheme of the Section is that without a warrant, if a person is arrested by the Officer in-Charge of a police station or if such person is brought before the Court, he is entitled to be released on bail, either by the police officer, or the Court concerned. 18. The legal contentions indicated hereinabove were opposed on behalf of the Union of India and the stand taken by Mr. Mohan Parasaran , learned Additional Solicitor General, was that what was required to be considered in the Writ Petitions was whether there is a power to arrest vested in the officers exercising powers under Section 13 of the 1944 Act without issuance of a warrant and whether such power could be exercised only after an FIR/complaint had been lodged under Section 13 of the aforesaid Act. It was also contended that it was necessary to consider further whether criminal prosecution or investigation could be initiated, which could lead to arrest, without final ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o file an investigation report under Section 173 Cr.P.C . and in all cases the officer concerned has to produce the suspect before the Magistrate after investigation for the purpose of remand. The learned ASG submitted that only on the filing of a complaint, can the criminal law be set in motion. 20. Mr. Prasaran also urged that the power to arrest must necessarily be vested in the Officer concerned under the 1944 Act for the efficient discharge of his functions and duties, inter alia, in order to prevent and tackle the menace of black money and money laundering. Mr. Prasaran submitted that in Union of India Vs. Padam Narian Aggarwal [2008 (231) ELT 397(SC)] = (2008-TIOL-187-SC-CUS), this Court had held that even though personal liberty is taken away, there are norms and guidelines providing safeguards so that such a power is not abused, but is exercised on objective facts with regard to commission of any offence. Reference was also made to the decision of the Punjab Haryana High Court in Sunil Gupta Vs. Union of India [2000 (118) ELT 8 P H] and Bhavin Impex Pvt. Ltd. Vs. State of Gujarat[ 2010 (260) ELT 526 ( Guj )], in which the issue, which is exactly in issue in the present ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under the second head thereby making such offence non-bailable. It was submitted that in essence it is the maximum punishment which has to determine the head under which the offence falls in Part 2 of the First Schedule to the Code and not the use of discretion by the Magistrate to award a lesser sentence. 23. In support of his submissions, Mr. Prasaran referred to the decisions of this Court in Superintendent of Police, CBI Ors . Vs. Tapan Kumar Singh [(2003) 6 SCC 175] and Bhupinder Singh Vs. Jarnail Singh [(2006) 6 SCC 207], to which reference will be made, if necessary. 24. As we have indicated in the first paragraph of this judgment, the question which we are required to answer in this batch of matters relating to the Central Excise Act, 1944, is whether all offences under the said Act are non-cognizable and, if so, whether such offences are bailable? In order to answer the said question, it would be necessary to first of all look into the provisions of the said Act on the said question. Sub-section (1) of Section 9A , which has been extracted hereinbefore, states in completely unambiguous terms that notwithstanding anything contained in the Code of Criminal Procedure, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Scheme of 1944 Act seem to suggest that the main object of the enactment of the said Act was the recovery of excise duties and not really to punish for infringement of its provisions. The introduction of Section 9A into the 1944 Act by way of amendment reveals the thinking of the legislature that offences under the 1944 Act should be non-cognizable and, therefore, bailable. From Part 1 of the First Schedule to the Code, it will be clear that as a general rule all non-cognizable offences are bailable, except those indicated hereinabove. The said provisions, which are excluded from the normal rule, relate to grave offences which are likely to affect the safety and security of the nation or lead to a consequence which cannot be revoked. One example of such a case would be the evidence of a witness on whose false evidence a person may be sent to the gallows. 27. In our view, the definition of non-cognizable offence in Section 2(l) of the Code makes it clear that a non-cognizable offence is an offence for which a police officer has no authority to arrest without warrant. As we have also noticed hereinbefore, the expression cognizable offence in Section 2(c) of the Code means an of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eals with the provisions of the Central Excise Act is the decision of the Division Bench of the Punjab Haryana High Court in the case of Sunil Gupta Vs. Union of India . In the said case also, the emphasis is on search and arrest and the learned Judges in paragraph 22 of the judgment specifically indicated that the basic issue before the Bench was whether arrest without warrant was barred under the provisions of the 1944 Act and the Courts had no occasion to look into the aspect as to whether the offences under the said Act were bailable or not. 30. In the circumstances, we are inclined to agree with Mr. Rohatgi that in view of the provisions of Sections 9 and 9A read with Section 20 of the 1944 Act, offences under the Central Excise Act, 1944, besides being non-cognizable, are also bailable, though not on the logic that all non-cognizable offences are bailable, but in view of the aforesaid provisions of the 1944 Act, which indicate that offences under the said Act are bailable in nature. 31. Consequently, this batch of Writ Petitions in regard to the Central Excise Act, 1944, must succeed and are, accordingly, allowed in terms of the determination hereinabove, and we hold th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er of Customs has been vested with the same power and is subject to the same provisions as an Officer in-Charge of a police station has under the Code of Criminal Procedure, for the purpose of releasing the arrested person on bail or otherwise. Mr. Rohatgi submitted that as in the case of Section 20 of the 1944 Act, the provisions of Sub-section (3) of Section 104 of the Customs Act, 1962, indicate that offences under the Customs Act would not only be non-cognizable, but would also be bailable. 35. Reverting to his submissions in relation to the Writ Petitions under the Central Excise Act, 1944, Mr. Rohatgi submitted that if it is assumed that the bailability in respect of an offence was to be determined by the length of punishment in relation to Part 2 of the First Schedule to Cr.P.C., it would be necessary that the duty leviable under the provisions of the Customs Act would first have to be adjudicated upon and determined. It was further submitted that there has to be a process of adjudication to determine the amount of levy before any punitive action by way of arrest could be taken. Reference was also made to the decision of this Court in Commissioner of Customs Vs. Kanhaiya E ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rposes of the Code of Criminal Procedure that the offences would be non-cognizable, but it did not mean that the concerned officer, who had been authorized to investigate into the evasion of excise duty, would have no power to investigate or arrest a person involved in such offences. In support of his submissions, Mr. Malhotra referred to the decision of this Court in Union of India Vs. Padam Narain Aggarwal [(2008) 13 SCC 305], wherein this Court had considered powers of arrest under other provisions such as the Customs Act. While deciding the matter, this Court had held that the power to arrest a person by a Customs Officer is statutory in character and cannot be interfered with. However, such power of arrest can be exercised only in such cases where the Customs Officer has reasons to believe that a person has committed an offence punishable under Sections 132, 133, 135, 135-A or 136 of the Customs Act. It was further observed that the power of arrest was circumscribed by objective considerations and could not be exercised on whims, caprice or fancies of the officer. 39. The learned ASG submitted that in N.H . Dave, Inspector of Customs Vs. Mohd . Akhtar Hussain Ibrahim Iqbal K ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sted by the officials of the Department for the purpose of the investigation and interrogation. It was further submitted that Section 104(4) of the Customs Act, 1962, indicates that the offences thereunder would be non-cognizable within the meaning of the Code and would prevent police officers under the Code from exercising powers of arrest, but such restriction do not apply to the special officers under various special statutes. 41. Mr. Malhotra submitted that the offences which were non-cognizable were not always bailable and special officers under special Statutes would continue to have the power to arrest offenders, even if under the Code police officers were prevented from doing so. 42. The submissions advanced by Mr. Rohatgi and the learned ASG, Mr. Malhotra, with regard to the question of bailability of offences under the Customs Act, 1962, are identical to those involving the provisions of the Central Excise Act, 1944. The provisions of the two above-mentioned enactments on the issue whether offences under both the said Acts are bailable, are not only similar, but the provisions of the two enactments are also in pari materia in respect thereof. 43. The provisions of S ..... X X X X Extracts X X X X X X X X Extracts X X X X
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