1996 (12) TMI 71 - HC - Central Excise

Summary

Issues:
Prosecution for evasion of Central Excise Duty, Appeal against penalty and re-assessment, Application for dropping prosecution and discharge, Stay of trial proceedings, Consideration of appellate tribunal's judgment.

Analysis:
The petitioner, M/s. Bata India Ltd., faced prosecution under section 9 of the Central Excises & Salt Act for evasion of Central Excise Duty between specific periods. The Collector of Customs found evasion of Excise duty amounting to Rs. 7.70 lacs in six cases and imposed a penalty of Rs. 1 lac. An appeal was made to the Customs (Central) Appellate Tribunal, which set aside the penalty and remanded the case for fresh assessment.

Subsequently, the Collector re-assessed the duty to Rs. 2.25 lacs and imposed a new penalty of Rs. 40,000. Another appeal was filed before the Appellate Tribunal, and a stay of proceedings was obtained. The petitioner then sought to drop the prosecution, arguing that the basis for prosecution had vanished due to the tribunal's decision. However, the Magistrate rejected the plea, leading to the current petition.

The petitioner's counsel contended that the trial should be stayed until the Appellate Tribunal's final decision to avoid potential unjust conviction. It was highlighted that without a final determination of the evaded duty, the trial court couldn't pass a lawful sentence under the Act. Despite some witnesses being examined, the High Court directed the Magistrate to continue examining all prosecution witnesses but stay further proceedings until the Appellate Tribunal's judgment.

The High Court emphasized that once the Appellate Tribunal's decision is rendered, the Magistrate must consider it and proceed with the case accordingly. With these directives, the petitions were disposed of, and the trial court records were to be returned promptly at the state's expense.