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TMI Blog1999 (4) TMI 92X X X X Extracts X X X X X X X X Extracts X X X X ..... ffairs and was "the authorised signatory as far as the Central Excise Act, 1944 ..... is concerned." He worked as General Manager till July, 1996. After that, Mr. Sandeep Aggarwal was authorised by a resolution dated July 12, 1996. A copy of the resolution has been produced as Annexure P.1 with the writ petition. The petitioner alleges that the copy of the resolution was "duly communicated to the persons concerned in the respondent department for their information, record and necessary action at their end." He was "in no way connected with the day to day functioning of the company and basically was only looking after the marketing operations .... and usually remains abroad for about six months in a year for the purpose of securing orders and also ensuring the payments for the materials already supplied ....." It has been averred that during the year 1997-98, the Company has earned foreign exchange to the tune of Rs.19 crores. During the current year till the filing of the petition, the Company had earned about Rs. 31 crores in foreign exchange. 4.On July 8, 1978, the factory premises of the company were searched. The books of account etc. were seized. Even though an "evasion of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ollowing observations :- "I do not subscribe to the arguments raised by the learned counsel for the petitioner. There are very serious allegations against the petitioner which require that custodial interrogation of the petitioner is necessary in the public interest. Resultantly, the bail application is hereby declined. Let intimation of dismissal of this bail application be sent to the Director General of Anti Evasion, Central Excise, R.K. Puram, New Delhi. Sd/- R.L. Anand Judge." December 1-1-1998 5.The petitioner maintains that he is not "running away from the investigation ……. and is willing to cooperate with the departmental authorities…………" He maintains that if "the working of the unit is disturbed in the manner it is sought to be done by the respondents, then the real sufferers would be the large number of share-holders, the financial institutions, about 700 persons who directly or indirectly are earning their livelihood while working for the company ….." 6.The Company was served with a demand-cum-show cause notice dated August 22, 1998 asking it to deposit a sum of Rs. 1,83,865/-. A reply was filed. Vide order dated January 7, 1999, the levy o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le for the conduct of its business. 9.On July 2, 1998, the officers of the Directorate General of Anti-evasion had searched the premises of M/s. Baroda Textile Limited, Karam Nagar, Ahmedabad. Having come to know of the raid, "Shri Sandeep Aggarwal, Director of M/s. GCUL Limited directed Shri Umesh C. Verma to destroy all relevant records by putting fire in the factory premises. The record was put to fire on 2nd/3rd July, 1998 and destroyed." On investigation, "it has been found that M/s. GCUL are selling their finished goods in the domestic market for which they have not paid any Central Excise Duty and have not obtained requisite valid permission and thereby evaded Central Excise Duty." It is further alleged that "on detailed investigation, it has been found that they had forged the signatures of the Inspector, Central Excise and provided fake re-warehousing particulars which has resulted in diversion of huge quantity of polyester texturised yard to domestic market as the same never reached M/s. GCUL Limited. As a result of this illicit and illegal diversion, large quantum of revenue has been evaded ....... "It has been admitted that the petitioner had deposited a sum of Rs. 10 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ontroverted by the counsel for the respondents. 12.It is apt to notice certain provisions of the Act. It provides for the levy and collection of Excise Duty. Section 9 prescribes the offences and the penalties therefor. Contravention of the provisions of the Act or any rules made thereunder, evasion of the duty, removal of excisable goods in violation of the provisions of the Act, are some of the offences described in Section 9. These are punishable "with imprisonment for a term which may extend to 7 years and with fine," if the leviable duty exceeds Rs 1 lakh. In any other case, the punishment can be "imprisonment for a term which may extend to three years or...... fine or....... both." Provisions of Sections 9A, 13, 14 and 18 deserve to be noticed in extenso. These are as under :- "9A. Certain offences to be non-cognizable. - Notwithstanding anything contained in the Code of Criminal Procedure, 1898 (5 of 1898), offences under Section 9 shall be deemed to be non-cognizable within the meaning of that Code. 13.Power to arrest. - (1) Any Central Excise Officer duly empowered by the Central Government in this behalf may arrest any person whom he has reason to believe to be liab ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on to believe to be liable to punishable under this Act." This provision embodies a substantive power and authorises the competent officer to arrest a person if he has some reason to believe that the person is liable to be punished under the Act. 14.Section 14 authorities the competent Central Excise Officer "to summon any person" whose attendance is considered necessary. Such a person can be asked to give evidence, produce a document or any other thing in the enquiry which is being conducted by the competent authority. The officer can even issue summons directing the persons to produce documents or other things. A person who has been summoned is bound to attend and to "state the truth.......". The proceedings conducted by the authorised officer are "judicial." A person can tell a lie. However, he does so only at his own peril. A breach of the obligation invites the wrath of law. It constitutes an offence under Section 193. 15.It is apparent that the proceedings conducted by an officer of the Central Excise are vitally different from the investigation by a police officer. It is implicit that a person who is making a statement before a Central Excise Officer can be called upon t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . It confers the power to arrest. The procedural safeguards have been protected by Section 18. This provision merely regulates the exercise of power under Section 13. It only provides that the searches and arrests under the Central Excise Act "shall be carried out in accordance with the provisions of the Code of Criminal Procedure....." In other words, an officer of the Central Excise shall make the arrest in 'the manner laid down in Section 46 of the Code of Criminal Procedure...... He "shall actually touch or confine the body of the person to be arrested....." In case of resistance, the officer of the Central Excise "may use all means necessary to effect the arrest." The persons arrested "shall not be subjected to more restraint than is necessary to prevent his escape. Similarly, a search shall be carried out in accordance with the procedure laid down in Section 100. If the person of a lady has to be searched, it shall be done "by another woman with strict regard to decency." Two or more independent and respectable inhabitants of the locality shall be called upon to be present. The search shall be made in their presence and "a list of things seized in the course of such search... ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... who can send him to a Magistrate. The arrested person is required to be admitted to bail under Section 20. 22.These are post-arrest matters. The concerned officer is entitled to act according to law and the facts of each case. As at present, the basic issue before the Bench is - Is an arrest without warrant barred? On an examination of the provisions, we are of the view that it is not so. We, accordingly, answer the question posed at the outset against the petitioners. We hold that an officer of the department of Central Excise who has been duly authorised by the Central Government is not debarred from arresting a person without a warrant when he has reason to believe that the person is liable to be punished under the Central, Excise Act, 1944. 23.Counsel for the petitioners had referred to the decisions in Shri Venkataramana Devaru and Others v. State of Mysore and Others, AIR 1958 S.C. 255 and State of Bihar and Another v. Shri P.P Sharma and Another, AIR 1991 S.C. 1260 to contend that the provisions of a statute have to be harmoniously construed. There is no quarrel with this proposition. However, on a harmonious construction, we are of the view that the power under Section ..... X X X X Extracts X X X X X X X X Extracts X X X X
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