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TMI Blog2004 (6) TMI 43X X X X Extracts X X X X X X X X Extracts X X X X ..... records including Central Excise statutory records from the factory premises of A-1 firm and from certain Garment exporters who have got the fabrics processed with A-1 firm and the CBI officers handed over the records to the Central Excise Department for necessary action. The officers of the Central Excise Department, Madras also searched and seized certain records from the Garment exporters, Sivam interior Exports (PW-2), Goyal Dresses (PW-3), Time Fashions and Sports Wear (PW-4) and several other Garment exporters and obtained their statements. The investigation disclosed that A-1 firm has cleared processed fabrics without payment of duty and collected processing charges through letter bills, cleared processed fabrics without payment of appropriate duty by collecting part of processing charges through regular invoices and part through letter head bills, cleared processed fabrics without payment of duty by preparing the invoices and Central Excise gate passes indicating the process as 'Scouring' which is exempted as against the actual process carried out viz., crinkling and dyeing, cleared processed fabrics without payment of duty by showing higher processing charges in the origi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ss. Fourthly, A-1 company have cleared processed fabrics without payment of duty by showing higher rate of processing charges in their original invoices and showing lesser rate of processing charges in the copy of the invoices sent to the Department. Fifthly, A-1 company have cleared processed fabrics having higher court above 51 counts attracting higher rate of duty and that by showing the lesser count in the documents submitted to the Department to avail lesser rate of duty. A-1 Company have shown higher width of fabrics to avail lesser rate of duty in order to show lesser sq. metre value by which they can avail lesser rate of duty." The period of evasion and the alleged amount of duty evaded by A-1 firm for the various periods are as noted below :- C.A. No. E.O.C.C. No. Period of Evasion Amount 444/1996 536/90 10-7-1982 to 9-5-1985 Rs. 1,96,166.03 445/1996 537/90 10-7-1982 to 9-5-1985 Rs. 1,96,166.03 446/1996 538/90 1984-1985 Rs. 9,376.77 447/1996 539/90 10-7-1982 to 9-5-1985 Rs. 1,96,166.03 6. To substantiate the charges against the accused in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the maintainability of the complaint could be considered. The trial court has referred to Section 37A of the Act in support of its finding that the prosecution has to prove that the Assistant Collector, Central Excise was specifically authorized to file such complaints against A-1 firm - M/s. Beauty Dyers. While so, referring to Section 37A of the Act, the trial court has ignored the points urged by the Standing Counsel for Central Excises in referring to Rule 207, on the maintainability of the complaints. 10. We may straightaway point out that the above findings on the maintainability of the complaint is perverse and non-sustainable. Section 37A of the Act deals only with the general delegation of powers. Section 37A has nothing to do with the filing of the complaints. Rule 207 stipulates that the complaint should not be filed by an officer inferior in rank to Inspector. If that condition is complied with, the complaint will be competent. In this case, the complaint is filed by the Assistant Collector which is in proper compliance with Rule 207. No further proceedings/specific authorization, authorizing Assistant Collector to file a complaint is essential. Section 190 Crl.P.C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the existence of guilty mind. But the statute with which we are concerned prescribes strict liability. Actus reus is to be proved for the violations under the Act. In the light of the arguments advanced, it is to be seen, Whether the prosecution has proved that A-1 company has cleared the processed fabrics without payment of appropriate amount ? It is also to be seen, Whether the appreciation of evidence by the trial court suffers from serious infirmity ? 13. A-1 firm - M/s. Beauty Dyers is the holder of Central Excise license No. L4 No. 4/82 (CEP) issued under Rule 174 of the Central Excise Rules for proceeding cotton fabrics falling under Tariff Item No. 191(b). 14. The grey fabrics are supplied by different Garment manufacturers who declare the cost of raw material including the cost of transport. The said M/s. Beauty Dyers, Madras have filed the price lists representing the cost of raw material, the cost of transportation and conversion charges which include the manufacturing cost and profit. The fabrics so processed are sent to the Garment manufacturers concerned who convert the fabrics into Garments and export them to foreign countries. The price lists so far submitted u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... yeing/bleaching, it could be proved only by production of their original invoices/gate passes. In almost all the instances of Garment manufacturers, the xerox copy of, either the invoices or gate passes are produced. For instance, the Garment manufacturers - M/s. Exind Corporation is said to have sent the fabrics to A-1 firm for processing. It is the further case of the prosecution that after processing, fabrics used for manufacturing Garments are exported to foreign countries. Prosecution is reasonably called upon to substantiate these aspects by proving :- (i) That the fabrics were sent to A-1 firm by Garment manufacturers; and (ii) The processed fabrics were sent back by A-1 firm after intermediate process, namely dyeing and bleaching, by the Garment manufacturers, which were used for making Garment for sale or export to foreign countries. 18. Witnesses concerning the Garment manufacturers are examined. The officers who conducted the house search in the premises of Garment manufacturers are also examined by the prosecution. In almost all the instances, only the xerox copies of the Invoices/Gate passes are said to have been seized. As rightly pointed out by the trial cour ..... X X X X Extracts X X X X X X X X Extracts X X X X
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