2017 Supreme(Guj) 704

IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
J.B. Pardiwala, J.
Nandeshwari Steel Ltd. and Ors. - Appellants
Vs.
State of Gujarat and Ors. - Respondents
Criminal Misc. Application (for Quashing & Set Aside FIR/Order) No. 11461 of 2015, Criminal Misc. Application Nos. 11467 and 11468 of 2015
Decided On : 04-04-2017

Headnote:

Code of Criminal Procedure, 1973 -Section 482 -Central Excise Tariff Act, 1985 -Negotiable Instrument Act, 1884 -Section 138 - Central Excise Act, 1944 -Indian Penal Code -Section 21 -Issues involved in all the captioned applications are the same and the parties are also the same, those were heard analogously and are being disposed of by this common judgment and order Criminal Misc. Application No. 11461 of 2015 is treated as the lead matter. By this application under Section 482 of the Code of Criminal Procedure, 1973, the applicants - original accused seek to invoke the inherent powers of this Court, praying for quashing of the proceedings of the Criminal Case No. 746 of 2013 pending in the Court of the learned Metropolitan Magistrate, Court No. 36 (Negotiable Instruments Act), , arising from a complaint filed by the respondent No. 2 herein under Section 138 of the Negotiable Instruments Act for the dishonour of the cheques. complaint filed by the respondent No. 2 reads as under : That, as per the Central Excise Act, 1944, the Government of India has constituted various Commissionerate of Central Excise Department for the recovery of Central Excise Duty from various manufacturers who are covered under the said Act and rules, Directorate General of Central Excise Intelligence is a Special Wing of the Central Excise Department constituted by the Central Government to detect the evasion of Central Excise duty by the manufacturer and proceed against them. accused No. 1 Steel Ltd. is a Public Limited Company and registered under the Indian Companies Act and engaged in manufacture of SS ingots, SS Round Bars falling under chapter - 72 of The Central Excise Tariff Act, 1985. The accused No. 2 is the director of the said Company and looking after day to day affairs of the said company and is responsible for the said company. Steel Ltd. falls within the Jurisdiction of the Commissioner of Central Excise III and are registered with Central Excise Division Office,. Directorate General of Central Excise Intelligence, having jurisdiction over the entire state of Gujarat for detecting and investigation of the cases of Central Excise duty evasion. on behalf of DGCEI, Senior intelligence officer, has been instructed and authorised to file this complaint by the order of the Additional Director General, DGCEI, Zonal Unit, is an employee of the Central Government and a public servant within the meaning of section 21 of the Indian Penal Code, in his such official capacity the complaint is filed. acting on the intelligence, the searches were carried out at the factory/office premises of the accused No. 1, transporters etc. by the officers of DGCEI, and various incriminating documents were recovered under the panchnamas drawn at the respective premises, preliminary scrutiny of the records resumed from the various premises revealed that the accused No. 1 has cleared SS Round bars clandestinely on cash basis without payment of Central Excise Duty thereon. It was also revealed that the accused No. -Held We are in respectful agreement with the above observations. In the present case, reference to the complaint (a copy of which is Annexures P-7) shows that as per the case of the complainant, the cheques which were subject matter of the said complaint were towards the partial repayment of the dues under the loan agreement (para 5 of the complaint).As is clear from the above observations of this Court, it is well settled that while dealing with a quashing petition, the Court has ordinarily to proceed on the basis of averments in the complaint. The defence of the accused cannot be considered at this stage. The court considering the prayer for quashing does not adjudicate upon a disputed question of fact."Thus, the dictum of law explained by the Supreme Court is, whether the cheque represents discharge of existing enforceable debt or liability or whether it represents advance payment without there being any subsisting debt or liability. In the absence of any adjudication by a competent authority under the provisions of the Act as regards the liability of the applicants to pay the excise duty, it cannot be said that on the date when the cheques were drawn there was an existing enforceable debt or liability.For the foregoing reasons, all the three applications are allowed. The proceedings of the Criminal Cases Nos. 746 of 2013, 819 of 2013 and 753 of 2013 pending in the court of the learned Metropolitan Magistrate, Court No. 36, , are hereby quashed.Rule is made absolute to the aforesaid extent in all the three cases -Rule Made Obsolute.