Tax Management India. Com
                        Law and Practice: A Digital eBook ...

Category of Documents

TMI - Tax Management India. Com
Case Laws Acts Notifications Circulars Classification Forms Manuals SMS News Articles
Highlights
D. Forum
What's New

Share:      

        Home        
 

TMI Blog

Home List
← Previous Next →

2018 (3) TMI 411

they, with the conspiracy of A1 to A3, fabricated record of destruction in their premises and sold the two autoconers to M/s.SJSML for ₹ 50 lakhs - Whether there are merits in this Criminal Petition to quash the proceedings in C.C.No.29 of 2006? - Held that: - civil and criminal proceedings can be initiated simultaneously and judgment in one proceeding will not have impact on the other - In the case on hand also, merely because CESTAT held that A4 and A5 need not pay the tax as claimed before the Commissioner, Customs and Central Excise, Guntur and approved by him, the criminal proceedings cannot be quashed. - The CESTAT observed as if it was not in dispute that machinery was dismantled under the supervision of the Central Excise Range Officers and cleared from the factory as scrap. When the foundation for case of the Department was that two autoconers were not destructed despite obtaining permission, it is quite astounding as to how the CESTAT observed that the destruction of two autoconers was not in dispute. Therefore, though the order of the CESTAT attained finality on civil side, still criminal proceedings against fraud and cheating can be independently establis .....

X X X X X X X

Full Text of the Document

X X X X X X X

aler for ₹ 1,90,000/- and a sum of ₹ 30,400/- was deposited in the bank towards Central Excise Duty. However, the investigation revealed, on 09.10.2003, A4 sold the said two autoconers to M/s.Sri Jayalakshimi spinning Mills limited, Chebrolu (M/s.SJSML) for of ₹ 50 lakhs. In fact, the said two autoconers were found in working condition at M/s.SJSML by Superintendent, Preventive, Central Excise, Gu ntur by evading tax hence they were seized. Therefore, the Central Excise Department issued show cause notice to petitioner/A4 demanding customs duty of ₹ 52.61 lakhs. Accordingly charge sheet was filed. Hence, the instant Criminal Petition for quashment. 3) Heard learned counsel for petitioner and learned Special Public Prosecutor for CBI. 4) Learned counsel for petitioner would challenge the proceedings in C.C.No.29 of 2006 on the main plank of argument that against the order passed by the Commissioner of Customs and Central Excise, Guntur petitioners Company preferred an appealC/270-272/2007 before the Customs Excise and Service Tax Appellate Tribunal (CESTAT), Bangalore and final order was passed in order Nos. 445-447/2012 allowing the appeal in favour of petit .....

X X X X X X X

Full Text of the Document

X X X X X X X

raud, wilful misstatement, suppression of facts and M/s.SJSML have purchased the two autoconers without payment of appropriate duty of customs. In spite of said contention, CESTAT held as if the department has not disputed the machinery was dismantled under the supervision of Central Excise Range Officers and cleared from the factory as scrap. The allegation of the department that two autoconers were sold by A4 and A5 to M/s.SJSML was not clearly discussed. Therefore, the order of CESTAT is not binding in the criminal proceedings. He thus prayed to dismiss the petition. 6) The point for consideration is: Whether there are merits in this Criminal Petition to quash the proceedings in C.C.No.29 of 2006. 7) POINT: The fulcrum of prosecution case is that A4 and A5 having obtained permission from the Deputy Commissioner, Central Excise, Guntur for destruction of two autoconers, indeed, did not do so, but they, with the conspiracy of A1 to A3, fabricated record of destruction in their premises and sold the two autoconers to M/s.SJSML for ₹ 50 lakhs and this fact was exhumed when the two autoconers were found in working condition at M/s.SJSML by Superintendent, Preventive, Central Ex .....

X X X X X X X

Full Text of the Document

X X X X X X X

against the accused for the offences charged against them. It is pertinent to note here that prosecution claims seizure of two autoconers in working condition in the premises of M/s.SJSML against the contention of the accused that those two autoconers were destructed in the premises of A4Company on 25.07.2002. If this fact is convincingly established by the prosecution in the trial, the accused will be liable for the offences charged against them. Therefore, as the matter stands, none of the guidelines extracted above in Bhajanlal (1 supra) would attract in this case to quash the proceedings. 10) Now, coming to the argument of learned counsel for petitioner regarding the order passed by CESTAT, I have gone through the said order dated 13.06.2012 in appeal Nos.C/270-272/2007. Those appeals are filed by A4 against the order passed by Commissioner of Customs and Central Excise, Guntur in his proceedings No.CEX-15/2006 (Commissioner) dated 14.12.2006. a) A perusal of said order would show that in Para-29 he gave a clear finding thus: Para-29: xx xx xx.. From the above facts, it is evident that the entire operation of applying for destruction of autoconers and transferring the same to .....

X X X X X X X

Full Text of the Document

X X X X X X X

ne fraud, with intend to evade payment of duty has been made out against the assessee by the Revenue. As a matter of fact, no such finding has been recorded in the impugned order. Therefore, the entire demand is also barred by limitation. 11) The petitioners contention is that since CESTAT has held that machinery was dismantled and payment of Central Excise Duty by the assessee as scrap and not as a capital good cannot be faulted, the criminal prosecution on the same accusation that the machinery was not destructed and the accused have fabricated documents in that regard, is unsustainable. 12) I am afraid this argument cannot be countenanced for the following reasons. a) Firstly, in this case the department has initiated simultaneous civil and criminal proceedingscivil proceedings for recovery of tax evaded with interest and penalty before the Commissioner and criminal proceedings for punishing the accused for their conspiratorial acts of cheating and falsification of records etc. b) It is a well known principle that when the same cause of action give rise to civil and criminal proceedings, both can be initiated simultaneously. The emancipation of the accused in the corresponding c .....

X X X X X X X

Full Text of the Document

X X X X X X X

The Apex Court observed thus: Para-30: What emerges from the aforesaid discussion is - (1) the previous judgment which is final can be relied upon as provided under Section 40 to 43 of the Evidence Act; (2) in civil suits between the same parties, principle of res- judicata may apply; (3) in a criminal case, Section 300 Cr.P.C. makes provision that once a person is convicted or acquitted, he may not be tried again for the same offence if the conditions mentioned therein are satisfied; (4) if the criminal case and the civil proceedings are for the same cause, judgment of the civil Court would be relevant if conditions of any of the Sections 40 to 43 are satisfied, but it cannot be said that the same would be conclusive except as provided in Section 41. Section 41 provides which judgment would be conclusive proof of what is stated therein. Para-31: Further, the judgment, order or decree passed in a previous civil proceedings, if relevant, as provided under Sections 40 and 42 or other provisions of the Evidence Act then in each case, Court has to decide to what extent it is binding or conclusive with regard to the matter(s) decided therein. Take for illustration, in a case of alleged .....

X X X X X X X

Full Text of the Document

X X X X X X X

tted by the persons accused thereof including the officers of the bank, criminal proceedings would also indisputably be maintainable. When a settlement is arrived at by and between the creditor and the debtor, the offence committed as such does not come to an end. The judgment of a tribunal in a civil proceeding and that too when it is rendered on the basis of settlement entered into by and between the parties, would not be of much relevance in a criminal proceeding having regard to the provisions contained in Section 43 of the Indian Evidence Act. Para-19: The judgment in the civil proceedings will be admissible in evidence only for a limited purpose. It is not a case where the parties have entered into a compromise in relation to the criminal charges. In fact, the offence alleged against the accused being an offence against the society and the allegations contained in the first information report having been investigated by the Central Bureau of Investigation, the bank could not have entered into any settlement at all. The CBI has not filed any application for withdrawal of the case. Not only a charge sheet has been filed, charges have also been framed. At the stage of framing ch .....

X X X X X X X

Full Text of the Document

X X X X X X X

eding, thus, can run parallely. The fact required to be proved for obtaining a decree in the civil suit and a judgment of conviction in the criminal proceedings may be overlapping but the standard of proof in a criminal case vis-a-vis a civil suit, indisputably is different. Whereas in a criminal case the prosecution is bound to prove the commission of the offence on the part of the accused beyond any reasonable doubt; in a civil suit preponderance of probability' would serve the purpose for obtaining a decree. 17) So, the above precedential jurisprudence would give a clear understanding that civil and criminal proceedings can be initiated simultaneously and judgment in one proceeding will not have impact on the other. In the case on hand also, merely because CESTAT held that A4 and A5 need not pay the tax as claimed before the Commissioner, Customs and Central Excise, Guntur and approved by him, the criminal proceedings cannot be quashed. The judgment in civil case will not be relevant under Sections 40, 41, 42 or 43 of the Evidence Act. At best, the said judgment will be relevant to consider the quantum of punishment to be imposed to the accused in case the criminal proceedin .....

X X X X X X X

Full Text of the Document

X X X X X X X

 

 

← Previous Next →

 

 

|| Home || About us || Feedback || Contact us || Disclaimer || Terms of Use || Privacy Policy || Database || Members || Refer Us ||

© Taxmanagementindia.com [A unit of MS Knowledge Processing Pvt. Ltd.] All rights reserved.
|| Blog || Site Map - Recent || Site Map ||