The Order of the Court is as follows :-

The petitioner in all the petitions is one and the same and it is accused No. 1 in EOCC Nos. 167 to 169 of 1996 on the file of Additional Chief Metropolitan Magistrate for Economic Offence Cases, Egmore, Madras and it seeks to quash the proceedings in the cases in so far as it is concerned.

2.The point for determination in all the petitions is one and the same and hence they are disposed of by common order.

3.The averments in all the petitions are similar and they are summarised. The petitioner company was engaged in manufacture of Zinc Chloride and Zinc Sulphate and it closed down its manufacturing operation in 1991. The petitioner company commenced production of Zinc Sulphate during the year 1985-86 by obtaining Central Excise Licence. The petitioner had informed the Central Excise Department the detailed manufacturing process and the nature of raw material used for manufacture of Zinc Sulphate. Various clarifications raised by the Central Excise department were also clarified by the petitioner during the period 1986 to 1990. The petitioner filed classification list containing the details of the excisable goods and the rate of duty that is sought to be claimed by it by giving the details of the exemption notification for concessional rate of duty and the petitioner has been following these procedures without fail.

The Excise Officer proposed modification of the classification list by issue of show cause notices on 15-5-1990 and August, 1990 and they were adjudicated upon on 16-9-1990 and in that order, the respondent department refrained from imposing any penalty acknowledging the fact that the petitioner had complied with the procedure prescribed under the law and had also got the classification list approved and hence there was no violation of any provisions of the Act or Rules and there was no attempt to evade payment of duty.While so, the Commissioner of Central Excise, Madras, issued show cause notice, dated 11-4-1991, seeking to demand a sum of Rs. 25, 39, 125.38 towards excise duty on brass/zinc/copper ingots manufactured by the petitioner during the period 1986-1990 by denying the benefits of concessional rate of duty under various exemption notifications during the relevant time. It was alleged in the show cause notice that the petitioner had suppressed material facts and irregularly availed of concessional rate of duty under the exemption notifications with intent to evade payment of central excise duty. Accordingly, the extended period of limitation prescribed under Section 11A of the Act was invoked and the duty was demanded under Rule 9(2) of the Rules. The show cause notice also proposed to impose penalty under Rule 173Q of the Rules. The petitioner gave detailed submission before the Commissioner of Central Excise, Madras, but, he in his order, dated 29-8-1991, confirmed the demand of duty of Rs. 24, 51, 006.96 and also imposed the penalty of Rs. 2, 00, 000/- on the petitioner.

The petitioner filed an appeal under Section 35B of the Act before the Customs, Excise and Gold (Control) Appellate Tribunal, Madras (CEGAT), in Appeal No. E/SB/1203/92, challenging the order of the Commissioner both with respect to demand of duty and imposition of penalty on the ground that the petitioner had not violated any of the provisions of the Act or Rules and it had no intention to evade payment of duty. When the appeal was pending before CEGAT, Madras, the respondent filed EOCC Nos. 167 to 169 of 1996 against the petitioner under Section 9(1)(b)(i) and 9(1)(bb)(i) of the Act for the alleged contravention of Rules 9(1), 173F and Rule 52A read with 173F and 173G read with Rule 226. The complainant filed three complaints for each financial year, namely, 1986-87, 1987-88 and 1988-89, which were taken on file in C.C. Nos. 167 to 169 of 1996 respectively. The total amount of alleged evasion for the entire period was Rs. 24, 51, 006.96, which was the amount demanded by the Commissioner o