Customs, Excise and Gold Tribunal - Delhi
Jagatjit Industries Ltd. vs Collector Of Central Excise on 11 February, 1993
Equivalent citations: 1993ECR358(TRI.-DELHI), 1993(67)ELT878(TRI-DEL)
ORDER Lajja Ram, Member (T)
1. Vide Misc. Application No. E/Misc/31/93-A, in Excise Appeal No. E/A/437/92-A, dated 11-1-1993, M/s. Jagatjit Industries Ltd., the appellants, have prayed that in exercise of the inherent powers conferred, and those specified under Section 35C of the Central Excises and Salt Act, 1944 (hereinafter referred to as the 'Act'), read with Rule 41 of the Customs, Excise and Gold (Control) Appellate Tribunal (Procedure) Rules, 1982 (hereinafter referred to as the 'CEGAT rules'), and in the interest of justice, the Tribunal may stay the operation of the Order-in-Original No. 29-CE/91, dated 28-10-1991, passed by the Collector, Central Excise, Chandigarh, and further direct the Collector, Central Excise, Chandigarh not to take any action pursuant to that Order which may cause prejudice to the appellants.
2. Under Order-in-Original No. 29/CE/91, dated 28-10-1991 the Collector, Central Excise, Chandigarh had demanded a duty of Rs. 60,52,808.37 under Section 11A of the Act from the appellants, on account of clearances of excisable goods effected at the lower assessable value. Pie has also imposed a penalty of Rs. 4,00,000/- (Rs. four lakhs) under Rule 173Q of the Central Excise Rules, 1944 (hereinafter referred to as the 'Rules') on the appellants on account of contravention of the provisions of the rules as discussed in his Order-in-Original, referred to above. Further, a penalty of Rs. 2000/- has been imposed on the appellants under Rule 226 read with Rule 227 of the rules.
3. Under Stay Order No. 212/92-A, dated 18-5-1992 the Tribunal had observed that prima facie the merits of the case are contentious and arguable. Keeping in view the totality of the facts and circumstances of the case, the Tribunal dispensed with the pre-deposit of the penalty amount of Rs. 4,02,000/- while ordering the appellants to pay the balance duty amount of Rs. 10,10,870/- within 6 weeks time from 18-5-1992. It was further ordered that during the pendency of the appeal, the Revenue authorities shall not pursue the recovery proceedings.
4. The appellants have stated now vide their Misc. Application dated 11-1-1993 referred to above that they understand that the Collector, Central Excise, Chandigarh based on the impugned Order-in-Original passed by him has sanctioned prosecution of the Chairman/Directors/Officers of the appellants company. Thay have further stated that they also understand that pursuant to the said sanction the proper officer of the Central Excise was likely to file a complaint before a Civil Court seeking the prosecution of the persons named therein. They added that if the action now proposed is based on the adjudication order passed by the Collector Central Excise which matter is sub-judice before the Tribunal, the appeal now pending before the Tribunal would become infructuous and may pre-judge the issue.
5. Shri Kapil Sibal, Senior Advocate made a special mention of the matter in the open Court on 12-1-1993 and pleaded that it is understood that prosecution in the case has been sanctioned by the Collector, Central Excise, Chandigarh. He requested for an urgent hearing in the matter. Keeping in view the urgency as urged by the learned Senior Advocate, the matter was fixed for 15-1-1993.
6. On 15-1-1993, Shri Kapil Sibal submitted that the case related to a bona fide dispute of law and there was no case of any forgery. There was no criminal intent and no intent to defraud the exchequer. Referring to the Stay Order No. 212/92-A, dated 18-5-1992 issued by the Tribunal in this case, he submitted that on the facts and circumstances of the case as analysed by the Tribunal, there could be no case for prosecution. In support, he referred to the Tribunal's Order Misc. No. 94 of 1985 (B) in the case of Pressure Cookers and Appliances Ltd., Jullunder v. Collector of Central Excise, Chandigarh wherein the Tribunal considering the entire facts and circumstances of the case restrained the respondent Collector of Central Excise from taking any action on the strength of the impugned Order dated 4-1-1985 till the next date of hearing or until further orders.
7. He relied upon the Supreme Court decision in the case of Uttam Chand v. I.T.O. reported in 1982 Vol. 133 Income Tax Reports, page 909.
8. Shri Prabhat Kumar, the learned SDR submitted that two questions were involved in this case. One related to the law for approaching this Tribunal for stalling the prosecution proceedings, and the other related to the merits of the case. On the first point, he pleaded that there was no power under the Act under which they could approach the Tribunal with regard to the sanction or launching prosecution in a Court of Law. As regards the inherent powers of the Tribunal in his view only when there were no specific powers then alone one could go to the inherent powers.
9. He submitted that each Section in the Act was independent. He referred to the ingredients of Sections 9, 9A and 9AA of the Act, and stated that the Collector's Order for initiating the prosecution was not a judicial order. It was only an administrative order and that there were no powers with the Tribunal in this regard particularly when no order as such sanctioning prosecution was before the Tribunal.
10. Relying upon the Tribunal's Misc. Order No. 39/88-B, dated 15-7-1985 in the case of Pressure Cookers and Appliances Ltd., Jullundar v. Collector of Central Excise, Chandigarh, he pleaded that the Tribunal may not interfere in the matter. Referring to Rule 41 of the CEGAT rules, Shri Prabhat Kumar, learned SDR stated that the request of the appellants does not relate to any Order passed by the Tribunal. He relied upon the following decisions :-
AIR 1969 SC 430;
1987 (29) E.L.T. 450;
1986 (26) E.L.T. 689.
11. On merits of the case, he submitted that in the Tribunal's Stay Order No. 212/92-A, dated 18-5-1992 there was nothing about the merits of the case.
12. Shri Sibal replied that the cases quoted by the learned SDR related to the smuggling cases. He referred to the Rule 173Q(d) of the rules under which if any manufacturer, producer or licensee of a warehouse contravenes any of the provisions of the Rules with intent to evade payment of duty then such manufacturer, producer or licensee of the warehouse was liable to a penalty. Thus penalty could be imposed only when there was intent to evade payment of duty. As in this case, the penalty has been stayed by the Tribunal, prima facie there was no intent to evade payment of duty.
13. Referring to Rule 41 of the CEGAT (Procedure) Rules the learned Sr. Advocate stated that to secure the ends of justice, the Tribunal could make such orders or give such directions as may be necessary or expedient. These were inherent powers of the Tribunal and could not be considered as ancillary powers.
14. We have carefully considered the submissions made by both the sides.
15. Under Section 35B of the Act any person aggrieved by a decision or Order passed by the Collector, Central Excise as an Adjudicating Authority may appeal to the Tribunal against such Order. Powers of adjudication are provided under Section 33 of the Act.
16. Under Section 35C the Tribunal may after giving the parties to the appeal an opportunity of being heard, pass such orders thereon as it thinks fit confirming, modifying or annulling the decision or Order appealed against or may refer the case back to the authority which passed such decision or order with such directions as the Tribunal may think fit, for a fresh adjudication or decision as the case may be, after taking additional evidence, if necessary.
17. Under Section 35F where in any appeal, the decision or Order appealed against relates to any duty demanded in respect of goods which are not under the control of the Central Excise authorities or any penalty levied under the Act, the person desirous of appealing against such decision or order shall, pending the appeal deposit with the adjudicating authority the duty demanded or the penalty levied.
18. It has, however, been provided that where in any particular case the Tribunal is of the opinion that the deposit of duty demanded or penalty levied would cause undue hardship to such person, the Tribunal may dispense with such deposit subject to such conditions as it may deem fit to impose so as to safeguard the interests of Revenue.
19. Prosecution in a Court of Law is provided under Section 9 of the Act :-
"Section 9. Offences and penalties - (1) Whoever commits any of the following offences, namely :-
(a) contravenes any of the provisions of a notification issued under Section 6 or of Section 8, or of a rule made under Clause (iii) of Sub-section (2) of Section 37;
(b) evades the payment of any duty payable under this Act;
(bb) removes any excisable goods in contravention of any of the provisions of this Act or any rules made thereunder or in any way concerns himself with such removal;
(bbb) acquires possession of, or in any way concerns himself in transporting, depositing, keeping, concealing, selling or purchasing, or in any other manner deals with any excisable goods which he knows or has reason to believe are liable to confiscation under this Act or any rule made thereunder;
(c) fails to supply any information which he is required by rules made under this Act to supply, or (unless with a reasonable belief, the burden of proving which shall be upon him, that the information supplied by him is true) supplies false information;
(d) attempts to commit, or abets the commission of any of the offences mentioned in Clauses (a) and (b) of this section;
shall be punishable, -
(i) in the case of an offence relating to any excisable goods, the duty leviable thereon under this Act exceeds one lakh of rupees, with imprisonment for a term which may extend to seven years and with fine :
Provided that in the absence of special and adequate reasons to the contrary to be recorded in the judgment of the Court such imprisonment shall not be for a term of less than six months;
(ii) in any other case, with imprisonment for a term which may extend to three years or with fine or with both.
(2) If any person convicted of an offence under this section is again convicted of an offence under this section, then, he shall be punishable for the second and for every subsequent offence with imprisonment for a term which may extend to seven years and with fine :
Provided that in the absence of special and adequate reasons to the contrary to be recorded in the judgment of the Court such imprisonment shall not be for a term of less than six months.
(3) For the purposes of Sub-sections (1) and (2), the following shall not be considered as special and adequate reasons for awarding a sentence of imprisonment for a term of less than six months, namely :-
(i) the fact that the accused has been convicted for the first time for an offence under this Act;
(ii) the fact that in any proceeding under this Act, other than a prosecution, the accused has been ordered to pay a penalty or the goods in relation to such proceedings have been ordered to be confiscated or any other action has been taken against him for the same act which constitutes the offence;
(iii) the fact that the accused was not the principal offender and was acting merely as a carrier of goods or otherwise was a secondary party in the commission of the offence;
(iv) the age of the accused."
20. Under Section 9AA of the Act, prosecution in respect of the offences by companies has been provided :-
"Section 9AA. Offences by companies -
(1) Where an offence under this Act has been committed by a company, every person who, at the time the offence was committed was in charge of, and was responsible to, the company for the conduct of the business of the company, as well as the company, shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly :
Provided that nothing contained in this Sub-section shall render any such person liable to any punishment provided in this Act, if he proves that the offence was committed without his knowledge or that he had exercised all due diligence to prevent the commission of such offence.
(2) Notwithstanding anything contained in Sub-section (1), where an offence under this Act has been committed by a company and it is proved that the offence has been committed with the consent or connivance of, or is attributable to any neglect on the part of, any director, manager, secretary or other officer of the company, such director, manager, secretary or other officer shall also be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly.
Explanation. - For the purposes of this section,
(a) "company" means any body corporate and includes a firm or other association of individuals; and
(b) "director" in relation to a firm means a partner in the firm."
21. A reading of the above provisions will show that the Tribunal is concerned with the adjudication Order appealed against. It can pass interim/final orders with regard to such adjudication orders. Prosecution is provided under Section 9 and Section 9AA of the Act, and with regard to proceedings under these Sections, the Tribunal has no role to play.
22. Further unless an appealable order is passed no cognizance can be taken by the Tribunal.
23. Sanction of the prosecution is an administrative act and in any case, it is for the Court of Law to adjudge the matters relating to punishment under Section 9 and Section 9AA.
24. There is no statutory provisions regarding sanctioning or approving the launching of prosecution in Central Excise cases. There is, however, such a provision in customs cases. Hon'ble Supreme Court had observed about the requirements in customs cases as under :-
"The authority granting sanction under Section 137 of the Customs Act is not expected to write a detailed judgment setting out all the facts and circumstances of the case in its order. The law only requires that there should be sufficient indication contained either in the order itself or in other records produced before Court to show that before granting sanction there had been due application of the mind of the authority to the relevant facts and circumstances of the case. It is to be remembered that the legislative purpose underlying the prescription of the pre-requisition condition of grant of sanction by a responsible officer like the Collector of Customs is the avoidance of vexatious and frivolous prosecution which may cause unnecessary harassment to the citizens. Section 137(1) is to be interpreted and applied consistent with the aforesaid licited objective it is intended to effectuate. It will be wholly wrong to put upon the said provision a hypertechnical construction as had been done by the High Court in the present case."
--- Supreme Court Criminal Appellate Jurisdiction Criminal Appeal No. 524 of 1982 U.O.I.and Anr. v. Dwarka Das and Anr. and Anr. CCE, Indore F. No. (10) LC iii/7/7/Nov. 83.
It is obvious that even in customs matters where there is specific provision for sanctioning of prosecution by the Collector, Customs, it is for the Court to take a view in the matter. The Gujarat High Court, Ahmedabad in the case - Jayan-tilal Maneklal Soni and Ors. v. Union of India [S.C.A. No. 69 and 122 of 1984 : 1984 (16) E.L.T. 33 (Guj.)] had observed as under :-
"There is no prohibition against proceedings under the Customs Act being taken up and continued during the pendency of the Criminal Proceedings...we do not think that the order of the Customs authorities declining to stay the proceedings is vitiated by any erroneous exercise of discretion."
25. In the case - Maniklal Pokhraj Jain v. Collector of Customs (Preventive), Bombay and Ors. [1986 (26) E.L.T. 689 (Bom.)] the Bombay High Court had held that adjudication proceedings before the departmental authorities were independent of prosecution. They quoted with the approval, the following observations of the Division Bench of the Bombay High Court in Misc. Petition No. 85 of 1978 :-
"15. Section 112 is an express provision which authorises the levy of penalty in respect of acts or omissions referred to therein. The procedure with regard to adjudication of confiscation and penalties is expressly provided for in Section 122 of the Act. The power is to be exercised by the Collector of Customs or Deputy Collector of Customs or by an Assistant Collector of Customs or by Gazetted Officer of Customs lower in rank than an Assistant Collector of Customs in accordance with the value of the goods liable to confiscation. The procedure to deal with confiscation or imposition of penalty is prescribed in Section 124 and under that provision a notice in writing has to be given to the concerned person informing him of the grounds on which it is proposed to confiscate the goods or to impose a penalty, and he is to be given a reasonable opportunity of being heard in the matter. Then comes Section 127 which expressly provides that even though an order of confiscation and an order of penalty is made by the Customs Officer that does not affect the liability to punishment under the provision of Chapter XVI or under any other law. We already reproduced the provisions of Section 135 to make it pointedly clear that the power to prosecute under Section 135 is without prejudice to the action which may be taken independently under the provisions relating to confiscation and penalty. Now, it cannot be the argument that while independent powers of making an order of confiscation and penalty can be made by the appropriate officer of the Customs, irrespective of a prosecution under Section 135 being resorted to or not, in case there is a prosecution and there is an acquittal, the power expressly bestowed under Section 112 must be treated as ineffective. Unless we are able to hold that even in spite of the express provisions of Section 112 and Section 127, in case there is an acquittal in prosecution instituted under Section 135, their powers cannot be exercised the contention on behalf of the Petitioner could not be accepted. We see no warrant for the view that there is a prohibition against the Customs Officers to perform their statutory functions and exercise their statutory power under the Act because of a failure of the prosecution started under Section 135 and the acquittal of the person concerned. By its very nature, the two proceedings are independent of each other. In a given case, evidence which may be available for the purposes of proceedings under Section 112 may not be available or even if it is available, it may be admissible in regular Court of law in which the admissibility and relevance of the evidence is determined with reference to the provisions of the Evidence Act. In a Criminal prosecution the accused need not open his mouth nor make any statement while in the proceedings for adjudication or confiscation before the Customs Department, the statement made by the person from whom the contraband articles were seized can be looked into. The scheme of the Act, therefore, clearly indicated that the two proceedings have to be dealt with independently of each other on such material as is available and permissible in these proceedings."
26. In the case - Satyanarayan, Indore v. Collector of Central Excise, New Delhi [1987 (29) E.L.T. 450 (Tribunal)], the Tribunal relying upon the above decision of the Divisional Bench of Bombay High Court had observed that it was settled law that criminal proceedings were separate from adjudication proceedings and that by its very nature the two proceedings were independent of each other and the adjudication proceedings before the Departmental authorities were not affected by the criminal Court. In 19671MLJ 146 Para 7 it has been held as under :-
"No doubt, it would be a strong predicament if, in spite of trial by criminal court on the same facts, the domestic Tribunal were to come to a different conclusion on the same facts. But there cannot be a complete prohibition against the Tribunal coming to a different conclusion, for it is well known that the Tribunal is not bound by several rules that are binding on appreciation of the evidence by a criminal Court."
27. In the case Jagannathrao Punjajirao Pagar v. Dipak Dubari [1991 (52) E.L.T. 36 (Bom.)], the Bombay High Court had ruled in the circumstances of that case before them that it cannot be said that exoneration in adjudication proceedings would knock out the very basis of the complaint moved against the accused persons.
28. In the case - Plasticraft Industries v. Assistant Collector of Central Excise [1991 (52) E.L.T. 168 (Mad.)], the Madras High Court did not agree to halt the prosecution at its threshold when certain definite allegations have been made in the complaint classifying the goods manufactured by the petitioners as attracting the levy of excise duty. They observed as under :-
"The last ground relating to stay of all further proceedings in the prosecution pending disposal of the appeal by CEGAT can now be considered. The Supreme Court in catena of decisions has held that the pendency of an appeal before the appellate authorities against adjudication proceedings would not be a bar for the criminal proceedings to be proceeded with, since the criminal Court will have to decide the issues arising out of the criminal proceedings on the evidence let in before the Criminal Court independently. However, the observations of the Supreme Court in P. Jayappan v. S.K. Perumal [AIR 1984 S.C. 1673] may be of some significance. The apex Court, while dealing with the pendency of the reassessment proceedings under the Income Tax Act, held that such proceedings cannot act as a bar to the institution of the criminal prosecution for offences under the Income Tax Act and Indian Penal Code. The institution of Criminal Proceedings cannot in such circumstances amount to an abuse of the process of Court. However, it may be that in an appropriate case, the Criminal Court may adjourn or postpone the hearing of a criminal case in exercise of its discretionary power under Section 309 of the Criminal Procedure Code, if the disposal of any proceeding under the Act which has a bearing on the proceedings before it is imminent so that it may take also into consideration the order to be passed therein. Even here the discretion should be exercised judicially and in such a way as not to frustrate the object of the Criminal Proceedings. There is no rigid rule which makes it necessary for a criminal Court to adjourn or postpone the hearing of a case before it indefinitely or for an unduly long period, only because some proceedings which may have some bearing on it is pending elsewhere. On this aspect the learned Counsel for the petitioners brought to my notice the judgment of the Gujarat High Court in Digvijay Cement Co. v. State of Gujarat [1989 (22) ECR 638 (Gujarat)] wherein S.S. Kapadia, J. held that when the matter was pending before the Tribunal and the possibility of allowing the appeal could not be ruled out, the petitioner cannot be said to have committed any offence and it was in the interest of justice, stay of criminal proceedings could be ordered, till the hearing of the appeal pending before the Tribunal. Since I have quoted the view of the Supreme Court relating to exercise of such power in appropriate cases, as a general rule, the view of the Gujarat High Court cannot be accepted. This question has no relevance to the maintainability of the prosecution. Though the prosecution cannot be quashed on this ground in the pending proceedings before the Judicial Magistrate, Poonamallee, the facts narrated leading to this prosecution certainly portrays that this an appropriate case where the proceedings in the criminal Court could be stayed for a certain period to facilitate disposal of the appeal preferred by the Petitioners before the CEGAT. If the Tribunal were to hold that the articles manufactured by the petitioners would not fall within the taxable net, the prosecution probably may be infructuous. Taking note of the steps taken by the petitioners at every stage, after the receipt of instructions by the Excise Authorities, I am of the view that the Criminal Proceedings now pending in C.C. No. 31 of 1989 on the file of the Judicial Magistrate, Poonamallee, can be stayed for a reasonable period. In that view, I direct stay of proceedings in C.C. No. 11 of 1989 aforementioned for a period of six months from today. Meanwhile, the prosecution as well as the defence are bound to take appropriate steps to have the appeal pending before the CEGAT disposed of."
29. In the matter before us, there is nothing to show that a complaint has been filed. There is no Order or decision before us on which we may pass Order under Section 35C. In any case, the Tribunal is not competent to issue any observations with regard to trial in the Court of Law.
30. In the case - Elite Optical Industries v. Assistant Collector of Enforcement [1991 (56) E.L.T. 16 (Mad.)] the Madras High Court did not agree with the view that if the Departmental Authorities had no good case for the purpose of adjudication they cannot claim to have a good case for the purpose of criminal prosecution. They observed as under :-
"It is rather very well-settled proposition by the apex of the judicial administration of this country that the adjudicatory proceedings and further prosecution in criminal Court in respect of the same matter is legally permissible as the same is not amounting to double jeopardy falling within the tentacles of Articles 20(3) of the Constitution of India. Further the Adjudicating Authority cannot at all be construed as a 'Court' trying an offence and giving a finding therefor in the said proceedings so that such a finding may be construed as one falling within the ambit of Section 300 of the Cr. P.C. In this view of the matter, notwithstanding a finding had been recorded by the Adjudicating Authority giving a clean chit that the petitioners had not retained any foreign exchange to their credit with M/s. Menrad, West Germany, the petitioners cannot be stated to be immune from criminal prosecution and further it is open to the Criminal Court to arrive at a finding different from the one given by the Adjudicating Authority, on consideration of the materials and evidence placed before it."
31. In the case before us the matter has already been adjudicated by the Collector, Central Excise, Chandigarh, and the appellants have been found liable to duty and penalty. This Adjudication Order is already in appeal before us and we have yet to take a view on the merits of the case.
32. In the case - Uttam Chand and Ors. v. Income Tax Officer, Central Circle, Amritsar [1982 ITR Vol. 133 P. 909], the Hon'ble Supreme Court had held in an income tax case that in view of the finding recorded by the Appellate Tribunal that Shrimati Janak Rani was a partner of the firm and that the firm was genuine, the assessee could not be prosecuted for filing false returns.
33. In the matter before us, there are no findings of the Tribunal on the merits of the case. The Order of the Collector, Central Excise, Chandigarh is there but findings in that order go against the petitioners.
34. In the case - Telu Ram Raunqi Ram and Anr. v. Income Tax Officer [1984 ITR Vol. 145 P. 1ll], the Punjab and Haryana High Court had observed that any proceedings against the assessee in a criminal Court cannot be stopped on mere expectancy that a finding which is favourable to the assessee petitioner would perhaps emerge.
35. In that income tax case, the petitioner's appeal to the Income-tax Appellate Tribunal had been dismissed, and the petitioners had sought a reference to the High Court, which was pending. The High Court took a view that the proceedings against the petitioners at that stage were not an abuse of the process of the Court, and staying them obviously would not be in the interest of justice. They added that it was true that there was no bar of limitation for economic offences under the law, yet proceedings could not be allowed to stagnate in the Criminal Court and make the law relating thereto a mockery.
36. Under Section 35C the Appellate Tribunal may after giving the parties to the appeal an opportunity of being heard pass such orders thereon as it thinks fit, confirming, modifying or annulling the decision or Order appealed against, or may refer the case back to the authority which passed such decision or order, with such directions as the Appellate Tribunal may think fit for the fresh adjudication or decision as the case may be after taking additional evidence if necessary.
37. The starting point is the decision or the Order appealed against. Unless there is a decision or order against which an appeal has been filed, no orders could be passed under Section 35C by the Tribunal. These powers of the Tribunal have to be read with reference to Section 35B which provides that any person aggrieved by a decision or order passed by the Collector of Central Excise as an Adjudicating Authority (amongst others) could appeal to the Appellate Tribunal against such order.
38. The procedure of Appellate Tribunal has been provided under Section 35D read with Section 129C of the Customs Act, 1962.
39. Section 129C(3) of the Customs Act while dealing with the procedure of Appellate Tribunal refers to appeal against a decision or order. Under Section 129C(6), the Tribunal have power to regulate its own procedure and the procedure of the Benches thereof in all matters arising out of the exercise of its powers or of the discharge of its function. The basis for the procedure before the Appellate Tribunal is the decision or order as per Section 35B.
40. We are, therefore, of the view that this Tribunal had no powers to intervene in a matter relating to sanctioning or launching of prosecution.
41. The learned Senior Advocate had invited our attention to Rule 41 of the CEGAT Rules and had pleaded that under its inherent powers, the Tribunal should direct the Collector, Central Excise, Chandigarh not to proceed with the prosecution if the prosecution is based on the adjudication order which is presently under appeal before us.
42. Making of orders or giving of directions under Rule 41 of the CEGAT Rules will have to be related to its orders or to prevent abuse of its process with regard to such orders or to secure the ends of justice with regard to such orders. Securing ends of justice will have to be read along with the orders of the Tribunal or to prevent abuse of its process with regard to such orders passed or to be passed.
43. There are 3 expressions in Rule 41 of the CEGAT Rules :- (1) 'In relation to its orders'; (2) 'to prevent abuse of its process' and (3) 'to secure ends of justice.' All these expressions flow from the genus 'in relation to its orders'.
44. In the case - Assistant Collector of Central Excise v. Ramdev Tobacco Company [1991 (51) E.L.T. 631 (S.C.)], the Hon'ble Supreme Court were analysing the expression 'Other legal proceedings' appearing in Sub-section (2) of Section 40 of the Act as it stood at the relevant point of time before its amendment by Amendment Act 22 of 1973 as under :-
"No suit, prosecution or other legal proceeding shall be instituted for anything done or ordered to be done under the Act after the expiration of six months from the accrual of the cause of action or from the date of the act or order complained of."
45. The point for consideration before the Hon'ble Supreme Court was whether the issuance of a show cause notice and the initiation of the consequential adjudicating proceedings can be described as "other legal proceedings" within the meaning of Sub-section (2) of Section 40 of the Act. Learned Additional Solicitor General had submitted that the expression 'other legal proceedings' must be read ejusdem generis with the preceding expressions 'suit' and 'prosecution', and if so read it becomes crystal clear that the Department's action cannot come within the purview of 'other legal proceeding'. The Hon'ble Supreme Court observed as under :-
"6. The rule of ejusdem generis is generally invoked where the scope and ambit of the general words which follow certain specific words (which have some common characteristic and constitute a genus) is required to be determined. By the application of this rule the scope and ambit of the general words which follow certain specific words constituting a genus is restricted to things ejusdem generis with those preceding them, unless the context otherwise requires General words must ordinarily bear their natural and larger meaning and need not be confined ejusdem generis to things previously enumerated unless the language of the statute spells out an intention to that effect. Courts have also limited the scope of the general words in cases where a larger meaning is likely to lead to absurd and unforeseen results. To put it differently, the general expression has to be read to comprehend things of the same kind as those referred to by the preceding specific things constituting a genus, unless of course from the language of the statute it can be inferred that the general words were not intended to be so limited and no absurdity or unintended and unforeseen complication is likely to result if they are allowed to take their natural meaning. The cardinal rule of interpretation is to allow the general words to take their natural wide meaning unless the language of the statute gives a different indication or such meaning is likely to lead to absurd results in which case their meaning can be restricted by the application of this rule and they may be required to fall in line with the specific things designated by the preceding words. But unless there is a genus which can be comprehended from the preceding words, there can be no question of invoking this rule. Nor can this rule have any application where the general words precede specific words.
7. There can be little doubt that the words 'other legal proceeding' are wide enough to include adjudication and penalty proceedings under the Act. Even the learned Additional Solicitor General did not contend to the contrary but what he said was that since this wide expression is preceded by particular words of a certain genus, namely, words indicating reference to proceedings taken in courts only, the wide words must be limited to things ejusdem generis and must take colour from the preceding words and should, therefore, receive a limited meaning to exclude proceedings of the type in question. There can be no doubt that 'suit' or 'prosecution' are those judicial or legal proceedings which are lodged in a court of law and not before any executive authority, even if a statutory one. The use of the expression 'instituted' in Section 40(2) strengthens this belief. Since this Sub-section has been construed by this Court in Raju's case (supra) not to be confined in its application to only Government servants but to extend to others including the assessees and since the words 'for anything done or ordered to be done under this Act' are found to be comprehensive enough to include acts of non-compliance or omissions to do what the Act and Rule enjoin, the limitation prescribed by Section 40(2) would undoubtedly hit the adjudication and penalty proceedings unless the expression 'other legal proceeding' is read ejusdem generis to limit its ambit to legal proceedings initiated in a court of law."
46. They agreed with the view that the wide expression 'other legal proceedings' must be read ejusdem generis with the preceding words 'suit' and 'prosecution' as they constitute a genus. In this view of the matter they upheld the contention of the learned Additional Solicitor General that the penalty and adjudication proceedings in question did not fall within the expression 'other legal proceeding' employed in Section 40(2) of the Act as it stood prior to its amendment by Act 22 of 1973 and, therefore, the said proceedings were not subject to the limitation prescribed by the said Sub-Section.
47. On the rule of ejusdem generis the Madhya Pradesh High Court in the case - Universal Cables Ltd., Satna v. Union of India and Ors. [1977 (1) E.L.T. (J 92)] has held as under :-
"The rule of ejusdem generis is founded on the reasoning that had the legislature intended the general words to be used in their unrestricted sense, it would have made no mention of the specific words as they, in such a case, would be superfluous. The rule applies when the following conditions exist : (i) the statute contains an enumeration of specific words; (ii) the subjects of enumeration constitute a class or category; (iii) that class or category is not exhausted by the enumeration; (iv) the general term follows the enumeration; and (v) there is no indication of a different legislative intent. (See Amar Chandra v. Excise Collector, Tripura [AIR 1972 S.C. 1863 at p. 1868]. [Southerland, Vol. 2 pp. 399, 400]."
48. In Byrne's Law Dictionary "ejusdem Generis " is defined as follows :-
"It is a rule of legal construction that general words following enumeration of particulars are to have their generality limited by reference to the preceding particular enumeration and to be construed as including only all other articles of the like nature and quality."
[Quoted in AIR 1928 Rangoon 31.]
49. In this view of the matter, the expression 'to secure the ends of justice' have to be read with the preceding expression in relation 'to its orders' or 'to prevent abuse of its process'.
50. On the point of edjusdem generis the facts in the case - Track Parts Corporation v. Collector of Customs [1992 (57) E.L.T. 98 (Tribunal)] were different as the expression for analysis was "tubes, pipes and hoses of vulcanised rubber other than hard rubber with or without their fittings (for example joints, elbows, flanges)."
51. As rightly observed by the Tribunal the rule cannot have any application where the general words precede specific words. In that case, the general words "fittings" preceded the specific words" joints, elbows, flanges." In the case before us, the specific reference is to the orders made by the Tribunal and the general words 'to secure the ends of justice' follow these specific words. Therefore, the rationale of the Hon'ble Supreme Court decision in the case - Assistant Collector, Central Excise v. Ramdev Tobacco Company (supra) is applicable to the matter before us.
52. In Rule 41 of the CEGAT rules the heading of the rule is "orders and directions in certain cases". Thus inherent powers of the Tribunal relate to certain specific cases and are not general in nature. In that rule, the words 'its orders' refer to the orders passed by the Tribunal. This is followed by "to prevent abuse of its process". It also relates to the process of the Tribunal with reference to the orders passed or sought to be obtained. Both these expressions constitute a genus and the expression "to secure the ends of justice" had to be read ejusdem generis with "its orders" and "its process" as they constitute a genus.
53. We may mention at this stage that the Tribunal in view of the decision of the Hon'ble Supreme Court in the case of I.T.O. v. Mohd. Kunhi reported in AIR 1969 (SC) 430, has got the powers to issue directions and pass such orders which are necessary for meeting the ends of justice. The fact and circumstances of the present case for the detailed reasons given in earlier paras do not justify the exercise of the inherent powers and as such we decline to interfere.
54. In an identical matter also argued by Shri Kapil Sibal, the learned Senior Advocate - Pressure Cookers and Appliances Ltd., Jullundar v. Collector of Central Excise, Chandigarh : Collector's order No. 23-CE/84/dated 4-1-1985, vide Misc. Order No. 39/85, dated 15-7-1985 (on Misc. Application No. 94/85-B) in Stay No. 162/85-B), the Tribunal had not considered it necessary to pass any orders on the request of the Senior Advocate in view of the statement of the Advocate for the respondents that the complaint against the appellants in competent Criminal Court was independent of adjudication Order passed by the Collector, Central Excise.
55. Earlier, the Tribunal vide Order dated 10-6-1985 considering the entire facts and circumstances of the case had restrained the respondent Collector of Central Excise from taking any action on the strength of the impugned Order dated 4-1-1985 till the next date of hearing or until further orders.
56. In this Order, we do not find anything to support the arguments of the learned Senior Advocate.
57. Taking all the above considerations in view and after giving our anxious thought to the matter we reject the Misc. Application No. E/Misc/ 31/93-A, dated 11-1-1993, and order accordingly.