TMI Blog1992 (11) TMI 111X X X X Extracts X X X X X X X X Extracts X X X X ..... ted Company registered under the Companies Act. The Company is engaged in manufacturing activities and, inter alia, manufactures Hermetic Compressors which are liable for payment of excise duty under Central Excises and Salt Act, 1944, On January 15, 1986, the Collector of Central Excise and Customs, Pune served show cause notice upon the Company and the petitioners to explain why penalty should not be imposed under Rule 9(2) and Rule 173Q(1) of the Central Excise Rules. The notice, inter alia, recites that the Company had contravened the provisions of Rule 173(C)(1) of the Rules by suppressing and failing to declare in the price list full particulars of the value realised in respect of clearance of Hermetic Compressors manufactured and cle ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... all be levied and collected duties of excise oh all excisable goods at the rates, set forth in the Schedule to the Central Excise Tariff Act, 1985. The expression 'manufacture' is defined under Section 2(f) of the Act and includes any process, incidental or ancillary to the completion of a manufactured product. The word 'manufacturer', provides Section 2(f) of the Act, shall be construed accordingly and shall include not only a person who employs hired labour in the production or manufacture of excisable goods, but also any person who engages in the production or manufacture on his own account. Rule 7 in Chapter III of the Central Excise Rules provides that every person who produces, or manufactures any excisable goods, shall pay the duty ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the decision of the Division Bench of this Court reported in 1984 Maharashtra Law Journal 117 (Suresh Tulsidas Kilachand and Others v. Collector of Bombay and Others) is appropriate. Shri Desai learned Counsel appearing on behalf of the Department, submitted that though the Company is legal entity, the functions of the Company are performed in accordance with the desire of the Board of Directors and the Executives and, therefore, the Board of Directors and the Executives are liable for payment of penalty. The submission is only required to be stated to be rejected. It is impossible to accept the claim that the penal liability can be enforced against a person in absence of specific provision under the Statute. "Shri Desai then referred to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vance their contentions and the Collector would be entitled to adjudicate whether the petitioners are liable. It is impossible to accede to the submission. This Court is bound to entertain the petition when the grievance is that the show cause notice is issued by the Collector without any jurisdiction whatsoever. An identical contention was raised before the Division Bench of this Court to which one of us (Pendse, J.) was a party, and turned down in the decision reported in 1991 (52) E.L.T. 500 (Tata Engineering and Locomotive Company Ltd. v. Union of India). It was held that the claim of the Department that the proceedings commenced with the service of show cause notice should be permitted to continue cannot be accepted when the show cause ..... X X X X Extracts X X X X X X X X Extracts X X X X
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