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TMI Blog2002 (5) TMI 74X X X X Extracts X X X X X X X X Extracts X X X X ..... f textile fabrics in case such person fails to pay the amount of duty or any part thereof by the specified date, is challenged, on the ground that the aforesaid Rule, is ultra vires the Constitution. 3. Rule 96ZQ of Rules, 1944, reads as under :- "96ZQ. Procedure to be followed by the independent processor of textile fabrics — (1) An independent processor of textile fabrics falling under heading Nos. 52.07, 52.08, 52.09, 54.06, 54.07, 55.11, 55.12, 55.13 and 55.14 of the Schedule to Central Excise Tariff Act, 1985 (5 of 1986), shall debit an amount of duty of Rs. 1.5 lac per chamber per month or Rs. 2 lacs per chamber per month, as the case may be, on the annual ca pacity of production as determined under the Hot Air Stenter Independent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... textile fabrics referred to in sub-rule (1) without complying with the requirements of that sub-rule or sub-rule (2) or sub-rule (3) then all such goods shall be liable to confiscation and the independent processor shall be liable to a penalty equal to an amount not exceeding three times the value of such goods, or rupees five thousand, whichever is greater. (7) Where an independent processor does not produce or manufacture the processed fabrics specified in sub-rule (1) during any continuous period of not less than seven days and wishes to claim abatement under sub-section (3) of section 3A of the Central Excise Act, 1944 (1 of 1944) the abatement will be allowed by an order passed by the Com missioner of Central Excise of such amount a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... id by an assessee in time. The aforesaid two clauses operate in different fields and it is known that compensatory measures as well as measure for deterrent effect can be provided and we find no difficulty in arriving at a conclusion that it is not possible to provide compensatory measure as well as the measures which would deter the assessees. What is important in the instant case in our view is that there is source of power and therefore the contention raised by the assessee that there is no source cannot be accepted. 6. What is important in the present case is that clause (ii) of sub-rule (5) of Rule 96ZQ of the Rules, provides for penalty. However, in the body of this clause, no guidelines are provided to impose penalty nor is there a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8. Before us, the learned Counsel appearing for the Revenue submitted that in view of the mandate as indicated in sub-rule (5) of Rule 96ZQ, the words contained therein, namely, "he shall be liable to" must mean that the penalty must be imposed as indicated in sub-clause (ii) of sub-rule (5) of Rule 96ZQ. It is required to be noted that in the case of State of Madhya Pradesh v. Bharat Heavy Electricals (supra), the Apex Court considered as to whether the words "shall be presumed" occurring in Section 28B were rebuttable or not. The Apex Court referred to the decision rendered in the case of Sodhi Transport and Anr. etc. etc. v. State of U.P. and Anr. etc. etc. reported in 1986 (1) SCR 939, wherein the Apex Court referred to Section 4 of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f a registered dealer is unable to satisfy the authorities in this regard then, in the absence of satisfaction, the presumption is that non-submission of statement has facilitated the evasion of entry tax". It is in view of this that the Apex Court held that the Section does not suffer from any vice and the Section is required to be construed to mean that the presumption contained therein is rebuttable and secondly, the penalty stipulated therein is only the maximum amount which would be levied and the assessing authority has the discretion to levy lesser amount depending upon the facts and circumstances of each case. Construing Section 7(5) in this manner, the Apex Court pointed out that the decision of the High Court that Section 7(5) is ..... X X X X Extracts X X X X X X X X Extracts X X X X
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