Himachal Pradesh High Court
Satinder Kapur vs Assistant Commissioner on 22 November, 2024
Author: Virender Singh
Bench: Virender Singh
( 2024:HHC:12424 ) IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA Cr. MMO No.54 of 2015 Reserved on : 24th August, 2024 Decided on : 22nd November, 2024 Satinder Kapur ...Petitioner Versus Assistant Commissioner, Central Excise & Another ...Respondents Coram The Hon'ble Mr. Justice Virender Singh, Judge. Whether approved for reporting?1 Yes. For the petitioner : Mr. Ankush Dass Sood, Senior Advocate with Mr. Shobhit Nandan, Advocate.
For the respondent : Mr. Vijay Kumar Arora, Advocate, for respondent No.1.
Mr. Mohinder Zharaick, Additional Advocate General for respondent No.2.
Virender Singh, Judge.
Petitioner - Satinder Kapur, feeling aggrieved from order dated 11.11.2014, passed by the Court of learned Additional Sessions Judge-II, Shimla (hereinafter referred to as the 'Revisional Court') has filed the present petition, under Section 482 of the Code of Criminal Procedure (hereinafter referred to as 'Cr.PC'). 1
Whether Reporters of local papers may be allowed to see the judgment? Yes.
2 ( 2024:HHC:12424 )
2. Vide order dated 11.11.2014, the Revisional Court has dismissed the Revision Petition No.16-S/10 of 2013, preferred against the order dated 16.11.2012, passed by the Court of learned Judicial Magistrate First Class, Court No.6, Shimla (hereinafter referred to as the 'trial Court') in Criminal Complaint No.37/2 of 2011/2001, titled as Assistant Commissioner versus M/s Indian Magnetics Ltd.
3. Vide order dated 16.11.2012, the learned trial Court has dismissed the application, moved by the petitioner, under Section 245 Cr.PC for discharging him from said complaint.
4. For the sake of convenience, the parties to the present lis are hereinafter referred to, in the same manner, as were, referred to, by the learned trial Court.
5. Brief facts, leading to the filing of the present petition, before this Court, may be summed up, as under:-
5.1. Complainant (Assistant Commissioner, Central Excise, Shimla) has filed the complaint, under Section 9(1), 9AA of Central Excise Act, 1944 and Sections 420, 463, 464, 465, 466, 468, 471 and 473 of the Indian Penal Code 3 ( 2024:HHC:12424 ) (hereinafter referred to as 'the IPC'), against M/s Indian Magnetic Ltd., Shoghi, District Shimla and Mr. Satinder Kapoor, M.D., M/s Indian Magnetic Ltd., Shoghi, District Shimla, on the ground that the complaint has been filed after obtaining the administrative approval for launching prosecution from Zonal Office, New Delhi.
5.2. As per the averments, as made in the complainant, accused M/s Indian Magnetic Ltd., 49/102/143, HPSIDC, Electronics Complex, Shoghi, District Shimla, are holding Central Excise licence/registration No.2/Chp-85/Chd-III/90 and are engaged in the manufacture of, amongst other goods, Video Tapes, Audio Tapes and Video Cassettes falling under sub-
heading No.85.23 of the schedule annexed to the Central Excise Act, 1985 and accused No.2, Satinder Kapoor, M.D. of the company, is looking after the day to day business of the company and is responsible for payment of Central Excise Duty leviable on the manufactured product at the time of clearance.
5.3. It has further been alleged that accused persons have indulged in evasion of Central Excise duty by 4 ( 2024:HHC:12424 ) way of suppression of production of Video/Audio Magnetic Tapes/Video Cassettes and clandestine removals of these goods without payment of Central Excise duty. 5.4. Explaining the modus operandi adopted by the unit, it is averred that they used to clear the goods either without payment of duty or they cleared the excess quantity and issued gate passes/invoices for the less quantity. They also used to issue gate passes in fake names and addresses for the excess quantity and used to take the delivery of these goods from the receiving end. In this regard, certain loose documents were stated to have been received.
5.5 Complainant had received tip off from one Bhimanand, who was working as a packer in the said unit. He was summoned on 24.4.96 and his statement under Section 14 of Central Excise Act 1944 (hereinafter referred to as 'the Act') has been recorded, in which, he has confronted with the documents, referred to above, and has stated that documents were relating to production, from the year 1990 to March, 1995.
5 ( 2024:HHC:12424 ) 5.6. On the basis of the above revelation, 12 documents were prepared/written by him and he signed these documents disclosing the following facts:-
i) The document on which "from Kaithlighat Dispatches on 27.10.93" is written shows 40 boxes containing 5000 cuts have been dispatched on 27.10.93 from Kaithlighat.
ii) The documents showing the dispatch date as 26.10.93 indicates that on 26.10.93, 49 boxes containing 6080 cuts were dispatched from factory and Railway receipt No. 687924.
iii) The document dated 21.4.94 shows 62 boxes containing 7100 cuts have been dispatched from factory of noticee and out of these 4260 cuts were cleared without payment of duty. The dispatch has been made under Railway receipt No 688023.
iv) The document dated 14.4.94 shows the dispatch of 52 boxes containing 5670 cuts out of which 4082 cuts were cleared after payment of duty and 1590 cuts without payment of duty.
v) Document dated 13.4.94 shows the dispatch of 4990 cuts.
vi) Document dated 7.4.94 shows the dispatch of 990 cuts and 10,000 Cassettes of E-180 and also 1,000 Cassettes of E-180.
vii) Document dated 31.3.94 shows dispatch of 15000 Cuts out of which 11,000 were cleared after payment of duty and 4.000 without payment of duty.
6 ( 2024:HHC:12424 )
viii) Document dated 5.4.93 shows the dispatch of 5600 cuts, out of which 4080 cuts were cleared after payment of duty and 1520 cuts were cleared without payment of duty.
ix) Document dated 17 5.94 shows the dispatch of 32 boxes of 3490 cuts, out of which 2443 were duty paid and 1047 non-duty paid.
x) Document dated 14.5.94 shows the dispatch of 7000 cuts, out of which 4160 were duty paid and 2840 were non-duty paid.
xi) Document dated 23.3.94 shows the dispatch of 4800 cuts.
xii) Document dated 13.10.93 shows dispatches of 50 boxes of 6000 cuts vide Railway receipt No. 687917 of Kaithlighat Railway Station.
xiii) Document dated 13:10 93 shows the dispatch of 50 Boxes of 6000 Cuts.
5.7. On the basis of the said statement, according to the complainant, it appears that the accused had cleared 39980 cut, measuring 136458.387 sq. mtrs. of Video Tapes and 11,000 Video Cassettes clandestinely and without payment of duty during the period w.e.f.13.10.93 to 4.7.94. 5.8. Thereafter, the business premises of the accused were searched on 20.6.1996 and 88 loose 7 ( 2024:HHC:12424 ) documents, regarding the production were taken into possession. Thereafter, the stock verification was done. As per the record, balance of RG-1 register, the following stock was found lying:-
i) unrecorded Video Tapes : 119814.475 (BSR) Sq. Mtrs.
25695.3125 (finishing Room)
ii) Unrecorded audio Tapes : 17949.99 sq. Mtrs.
iii) Video Cassettes : 1354 Nos.
5.9. However, on physical verification the following goods were found:-
i) unrecorded Video Tape in : 961 pancakes the form of pancakes (in thermocol trays)
ii) Unrecorded Video Tape in : 51 pancakes the form of pancakes (in plastic tray).s
iii) Unrecorded Video Tape in : 382 boxes the form of pancakes of different lengths (contained in boxes).
iv) Unrecorded Audio Tapes : 12 boxes
in the form of Jumbo
Rolls (contained in Boxes)
v) Video Cassettes : 1354 Nos.
5.10. As per the further case of the complainant, the above goods were verified on 27/28.11.96 and the proceedings of verification were drawn under the proper panchnama dated 28.11.96. On verification, it was found
8 ( 2024:HHC:12424 ) that there is shortage of 9112.785 sq. mtrs. of video Magnetic Tapes valued at Rs.80,739.27/- involving Central Excise Duty of Rs.16,147.86. According to the complainant, accused Satinder Kapoor had admitted the aforesaid shortage.
5.11. Thereafter, show cause notices were issued to the accused, upon which, the following orders were passed by Commissioner, Central Excise Commissioner at, Chandigarh-I, vide order-in-original No.54/CE/99 dated 30.12.2000:-
i) I demand Central Excise duty Rs.2,39,68,344.00 (Rupees Two Crores thirty nine lacs sixty eight thousand and three hundred forty four only) from M/s IML, Shoghi under Rule 9(2) of the Central Excise Rules, 1944 read with Section 11A of the Central Excise Act, 1944 and direct them to pay forthwith;
ii) I direct M/s. IML Shoghi to pay interest @20% per annum under Section 11AB of the Central Excise Act, 1944 read with Notification No. 34/96-CE(NT) dated 9.10.96 on the amount of duty Rs.2,39,68,344.00 w.ef. 28.9.96 till the said amount is paid;
iii) I impose penalty of Rs. 2,39,68,344.00 (Rupees Two Crores thirty nine lacs sixty eight thousand and three hundred forty four only) upon Mis. IML Shoghi under Section 11AC of the Central Excise Act, 1944 read with Rule 173Q of the Central Excise Rules, 1944 9 ( 2024:HHC:12424 )
iv) I also impose personal penalty Rs.10,000,000/-, (Rupees Ten Lacs Only) upon Sh Satinder Kapoor, Managing Director of M/s. IML Shoghi under Rule 209A of the Central Excise Rules, 1944 and;
v) I refrain from confiscating land, building, plant and machinery as proposed in the Show Cause Notice dated 3.12.97.
5.12. Lastly, it has been pleaded that the accused persons have deliberately violated the Central Excise Rules, 1944 with intention to evade Central Excise Duty. Hence, a prayer has been made to the Court to take cognizance of the offence, to try and convict the accused for the offence, under which, the complaint has been filed. 5.13. Along with the complaint, list of witnesses, mentioning 12 witnesses and list of documents, mentioning 44 documents have been filed.
6. On this complaint, the learned trial Court has passed the summoning order dated 28.3.2001. After the accused persons put appearance, the complaint was directed to adduce pre-charge evidence, upon which, the complainant has examined, as many as, three CWs.
7. Thereafter, accused Satinder Kumar, has filed the application under Section 245 Cr.PC, on 09.10.2009.
10 ( 2024:HHC:12424 ) The said application was rejected by the learned trial Court, vide order dated 16.11.2012.
8. Aggrieved from the said order, the accused persons have unsuccessfully assailed the same by filing Criminal Revision No.16-S/10 of 2016, before the learned Revisional Court. However, the said Revision Petition has been dismissed vide judgment dated 11.11.2014.
9. Feeling aggrieved from the said judgment, the present petition, under Section 482 Cr.PC, has been filed, before this Court, assailing the order passed by learned Revisional Court, on the ground that from the evidence of the witnesses, who have been examined by the complainant, no offence is made out against accused No.2. The fact that accused No.2, has been arrayed as accused in the capacity of Managing Director has not been considered by the learned trial Court and as such, no liability can be fastened upon him. According to the accused, no charge under Section 420 IPC, can be framed against him. 9.1. The order, by virtue of which, the application under Section 245 Cr.PC, was dismissed, has also been assailed on the ground that from the evidence, so adduced 11 ( 2024:HHC:12424 ) by the complainant, no act of preparation of any forged document, by the accused, can be established, as the complainant has not produced the documents relied upon by it.
9.2. Apart from this, the order passed by the learned Revisional Court, has also been impugned before this Court on the ground that the plaintiff has deliberately concealed the material facts to harass the accused, as the factum of order dated 22.8.2000, passed by the learned CEGAT, whereby, the order passed by the learned Commissioner, Central Excise, dated 30.12.2000, imposing penalty and demanding excise duty, has been set aside, has not been brought on record.
10. On the basis of the above facts, a prayer has been made to allow the petition by quashing the order passed by the learned trial Court and upheld by the Revisional Court, by discharging the accused from the said complaint.
11. Accused No.2-Satinder Kapur, has moved application, under Section 245 Cr.PC, before the learned trial Court to discharge him in this case. The said 12 ( 2024:HHC:12424 ) application was dismissed by the learned trial Court on 16.11.2012, mainly, on the ground that prima facie, there is sufficient evidence on record to take note of the contentions of the applicant/accused No.2 that there is no iota of evidence produced on record cannot be given undue weightage, especially, in view of the statements of the witnesses, as well as, the documents placed on record. Operative paragraph 5 of the order, passed by the learned trial Court, is reproduced, as under:-
"5. The statements recorded under provision of Central Excise Act are also contended to be recorded wrongly on behalf of accused No. 2 highlighting that the same ought to be recorded in presence of various persons but again it is also pertinent to mention that such contention as raised by the accused No. 2 do not goes to show that no proceedings ever were undertaken under that act because irregularities, if any, in recording those statements can be appreciated after the entire evidence is recorded after framing of charge. Further, the case law titled as "Ajay Kumar Ghose Vs. State of Jharkhand and Anr 2009 (3) Criminal Courts Cases 412 S.C."
is also not applicable to the facts of the present case especially at this stage. It may be mentioned that the allegations against the accused persons with respect to excess production and clandestine removal was modified by CEGAT but still the intention of the accused persons as has been highlighted by the complainant was to deprive the department of legitimate duty and therefore, prima-face, there is sufficient evidence on record to take note of and contention of 13 ( 2024:HHC:12424 ) applicant/accused no.2 that there is no iota of evidence produced on record cannot be given undue weightage especially in view of the statements of witnesses as well as documents placed on record and as such, evidence in pre- charge led by the complainant is sufficient to proceed with the present complaint. For these reasons, the accused cannot be discharged at this stage. In view of the above discussion, present application under Section 245 Cr.PC is dismissed and charge can be framed against the accused persons on the basis of pre-charge evidence alongwith documents in support there of. Hence, to come up for framing of charge on 10-12-2012."
12. In this case, when, accused No.2 appeared before the Court, in pursuance of the summoning order dated 28.03.2001, the complainant was directed to adduce its evidence and after recording the evidence of the complainant, the present petitioner, who had been arrayed as accused No.2, in the said case, had moved an application on 9.10.2009.
13. In this background, the material question, which arises for determination, before this Court, is about the fact whether the learned trial Court, at the time of deciding the application, under Section 245 Cr.PC, is required to see the prima facie case or more than that.
14 ( 2024:HHC:12424 )
14. The learned trial Court, after dismissing the application, has decided to frame charges against the accused. The provisions of Sections 244, 245 and 246 Cr.PC, are reproduced, as under:-
244. Evidence for prosecution.
(1)When, in any warrant-case instituted otherwise than on a police report, the accused appears or is brought before a Magistrate, the Magistrate shall proceed to hear the prosecution and take all such evidence as may be produced in support of the prosecution.
(2)The Magistrate may, on the application of the prosecution, issue a summons to any of its witnesses directing him to attend or to produce any document or other thing.
245. When accused shall be discharged.
(1) If, upon taking all the evidence referred to in Section 244, the Magistrate considers, for reasons to be recorded, that no case against the accused has been made out which, if unrebutted, would warrant his conviction, the Magistrate shall discharge him.
(2)Nothing in this section shall be deemed to prevent a Magistrate from discharging the accused at any previous stage of the case if, for reasons to be recorded by such Magistrate, he considers the charge to be groundless.
246. Procedure where accused is not discharged.
(1)If, when such evidence has been taken, or at any previous stage of the case, the Magistrate is of opinion that there is ground for presuming that the accused has committed an offence triable under this Chapter, which such Magistrate is competent to try and which, in his opinion, could be adequately punished by him, he shall frame in writing a charge against the accused.
15 ( 2024:HHC:12424 ) (2)The charge shall then be read and explained to the accused, and he shall be asked whether he pleads guilty or has any defence to make. (3)If the accused pleads guilty, the Magistrate shall record the plea, and may, in his discretion, convict him thereon.
(4)If the accused refuses to plead, or does not plead or claims to be tried or if the accused is not convicted under sub-section (3), he shall be required to state, at the commencement of the next hearing of the case, or, if the Magistrate for reasons to be recorded in writing so thinks fit, forthwith, whether he wishes to cross-examine any, and, if so, which, of the witnesses for the prosecution whose evidence has been taken. (5)If he says he does so wish, the witnesses named by him shall be recalled and, after cross- examination and re-examination (if any), they shall be discharged.
(6)The evidence of any remaining witnesses for the prosecution shall next be taken, and after cross-examination and re-examination (if any), they shall also be discharged.
15. The legislature, in its wisdom has enacted the provisions of Section 245 Cr.PC., to filter the frivolous private complaint and to protect the accused from harassment.
16. The learned trial Court, in the impugned order, has not even discussed the evidence, so adduced, by the complainant, while deciding the application under Section 245 Cr.PC.
16 ( 2024:HHC:12424 )
17. The Hon'ble Supreme Court, in Ajoy Kumar Ghose Versus State of Jharkhand & another, AIR 2009 Supreme Court 2282, has elaborately discussed the provisions of Sections 244 to 246 Cr.PC and held that under Section 245 Cr.PC, the Magistrate has the advantage of the evidence, led by the prosecution, before him, under Section 244 Cr.PC, and he has to consider whether, if the evidence remains unrebutted, the conviction of the accused would be warranted. Relevant paragraphs 14 to 18 of the judgment, are reproduced, as under:-
"14. However, in a warrant trial instituted otherwise than on a police report, when the accused appears or is brought before the Magistrate under Section 244(1) Cr.P.C., the Magistrate has to hear the prosecution and take all such evidence, as may be produced in support of the prosecution. In this, the Magistrate may issue summons to the witnesses also under Section 244(2) Cr.P.C. on the application by prosecution. All this evidence is evidence before charge. It is after all this, evidence is taken, then the Magistrate has to consider under Section 245(1) Cr.P.C., whether any case against the accused is made out, which, if unrebutted, would warrant his conviction, and if the Magistrate comes to the conclusion that there is no such case made out against the accused, the Magistrate proceeds to discharge him. On the other hand, if he is satisfied about the prima facie case against the accused, the Magistrate would frame a charge under Section 246(1) Cr.P.C. The complainant then gets the second opportunity to lead evidence in support of the charge 17 ( 2024:HHC:12424 ) unlike a warrant trial on police report, where there is only one opportunity. In the warrant trial instituted otherwise than the police report, the complainant gets two opportunities to lead evidence, firstly, before the charge is framed and secondly, after the charge. Of course, under Section 245(2) Cr.P.C., a Magistrate can discharge the accused at any previous stage of the case, if he finds the charge to be groundless.
15. Essentially, the applicable Sections are Section 244 and 245 Cr.P.C., since this is a warrant trial instituted otherwise than on police report. There had to be an opportunity for the prosecution to lead evidence under Section 244(1) Cr.P.C. or to summon its witnesses under Section 244(2) Cr.P.C. This did not happen and instead, the accused proceeded to file an application under Section 245(2) Cr.P.C., on the ground that the charge was groundless.
16. Now, there is a clear difference in Sections 245(1) and 245(2) of the Cr.P.C. Under Section 245(1), the Magistrate has the advantage of the evidence led by the prosecution before him under Section 244 and he has to consider whether if the evidence remains unrebutted, the conviction of the accused would be warranted. If there is no discernible incriminating material in the evidence, then the Magistrate proceeds to discharge the accused under Section 245(1) Cr.P.C.
17. The situation under Section 245(2) Cr.P.C. is, however, different. There, under sub- Section (2), the Magistrate has the power of discharging the accused at any previous stage of the case, i.e., even before such evidence is led. However, for discharging an accused under Section 245 (2) Cr.P.C., the Magistrate has to come to a finding that the charge is groundless. There is no question of any consideration of evidence at that stage, because there is none. The Magistrate can take this decision before the accused appears 18 ( 2024:HHC:12424 ) or is brought before the Court or the evidence is led under Section 244 Cr.P.C. The words appearing in Section 245(2) Cr.P.C. "at any previous stage of the case", clearly bring out this position. It will be better to see what is that "previous stage".
18. The previous stage would obviously be before the evidence of the prosecution under Section 244(1) Cr.P.C. is completed or any stage prior to that. Such stages would be under Section 200 Cr.P.C. to Section 204 Cr.P.C. Under Section 200, after taking cognizance, the Magistrate examines the complainant or such other witnesses, who are present. Such examination of the complainant and his witnesses is not necessary, where the complaint has been made by a public servant in discharge of his official duties or where a Court has made the complaint or further, if the Magistrate makes over the case for inquiry or trial to another Magistrate under Section 192 Cr.P.C. Under Section 201 Cr.P.C., if the Magistrate is not competent to take the cognizance of the case, he would return the complaint for presentation to the proper Court or direct the complainant to a proper Court.
Section 202 Cr.P.C. deals with the postponement of issue of process. Under sub- Section (1), he may direct the investigation to be made by the Police officer or by such other person, as he thinks fit, for the purpose of deciding whether or not there is sufficient ground for proceeding. Under Section 202(1)(a) Cr.P.C., the Magistrate cannot given such a direction for such an investigation, where he finds that offence complained of is triable exclusively by the Court of sessions. Under Section 202(1)(b) Cr.P.C., no such direction can be given, where the complaint has been made by the Court. Under Section 203 Cr.P.C., the Magistrate, after recording the statements on oath of the complainant and of the witnesses or the result of the inquiry or investigation ordered under Section 202 Cr.P.C., can dismiss the complaint if he finds that there is 19 ( 2024:HHC:12424 ) no sufficient ground for proceeding. On the other hand, if he comes to the conclusion that there is sufficient ground for proceeding, he can issue the process under Section 204 Cr.P.C. He can issue summons for the attendance of the accused and in a warrant- case, he may issue a warrant, or if he thinks fit, a summons, for securing the attendance of the accused. Sub-Sections (2), (3), (4) and (5) of Section 204 Cr.P.C. are not relevant for our purpose. It is in fact here, that the previous stage referred to under Section 245 Cr.P.C. normally comes to an end, because the next stage is only the appearance of the accused before the Magistrate in a warrant- case under Section 244 Cr.P.C. Under Section 244, on the appearance of the accused, the Magistrate proceeds to hear the prosecution and take all such evidence, as may be produced in support of the prosecution. He may, at that stage, even issue summons to any of the witnesses on the application made by the prosecution. Thereafter comes the stage of Section 245(1) Cr.P.C., where the Magistrate takes up the task of considering on all the evidence taken under Section 244(1) Cr.P.C., and if he comes to the conclusion that no case against the accused has been made out, which, if unrebutted, would warrant the conviction of the accused, the Magistrate proceeds to discharge him. The situation under Section 245(2) Cr.P.C., however, is different, as has already been pointed out earlier. The Magistrate thereunder, has the power to discharge the accused at any previous stage of the case. We have already shown earlier that that previous stage could be from Sections 200 to 204 Cr.P.C. and till the completion of the evidence of prosecution under Section 244 Cr.P.C. Thus, the Magistrate can discharge the accused even when the accused appears, in pursuance of the summons or a warrant and even before the evidence is led under Section 244 Cr.P.C., makes an application for discharge.
20 ( 2024:HHC:12424 ) (self emphasis supplied)
18. Whereas, the learned trial Court, while deciding the application, has simply rejected the application, by holding that a prima facie case is made out against the accused. Prima facie case is only to be seen, by the Magistrate, at the time of issuing the process, on the basis of the preliminary evidence adduced, by the complainant.
19. At the time of deciding the application for discharge, under Section 245 Cr.PC, the learned trial Court is supposed to mete out the contentions, as raised within the frame work of the law, however, in the present case, the learned trial Court has simply reproduced the contentions and without discussing the evidence, has concluded that a prima facie case is made out against the accused. Hence, the approach of the learned trial Court in dismissing the application, is not sustainable, in the eyes of law. As such, the impugned order passed by the learned trial Court is liable to be set aside.
20. Similarly, the learned Revisional Court has also fallen into error by not considering the law, in its right perspective.
21 ( 2024:HHC:12424 )
21. In view of the above discussion, the present petition is allowed and the impugned order dated 16.11.2012, passed by the learned trial Court is set aside. The matter is remanded back to the learned trial Court to decide afresh, in view of the observations made hereinabove.
22. The parties, through the learned counsel representing them, are directed to appear before the learned trial Court on 3rd December, 2024.
23. Since, the matter is old one, as such, the learned trial Court is requested to decide the application, under Section 245 Cr.PC, moved by the accused, for discharge, on priority basis, not beyond the period of 20 days from the date of appearance of the parties.
Record be sent back immediately.
( Virender Singh ) Judge November 22, 2024(ps)