Summons under Central Excise

What happens if the summoned person does not appear before the summoning authority?

 

by

 

VIJAY. K. KUMAR

MA, B.Ed,BL,MBA

Superintendent of Central Excise, Hyderabad

 

Under Section 14 of the Central Excise Act, a duly empowered Central Excise Officer can summon any person………….. All persons so summoned shall be bound to attend, state the truth and produce documents and other things as may be required. Further the inquiry is deemed to be judicial proceedings within the meaning of section 193 and section 228 of the IPC.

 

So we know that a person summoned is bound to attend and state the truth and the proceedings are judicial.

 

What happens if the person summoned does not turn up, as it happens quite often? While the persons who readily obey the summons have bitter stories about the behaviour of the officers, we hardly hear any story about those who refuse to comply with the summons. There doesn't seem to be a clear idea as to what is to be done if somebody does not comply with the summons. And at least one High Court had held that failure to comply with summons by itself can not be said to establish guilt.

Before going into the details, it is worthwhile to examine what the judicial proceedings are about. As per section 14 of CEA 1944, the proceedings are judicial within the meaning of section 193 and section 228 of the Indian Penal Code. Let us have a look at these sections of the IPC

193 PUNISHMENT FOR FALSE EVIDENCE.

Whoever intentionally gives false evidence in any stage of a judicial proceeding, or fabricates false evidence for the purpose of being used in any stage of a judicial proceeding, shall be punished with imprisonment of either description for a term which may extend to seven years, and shall also be liable to fine;

and whoever intentionally gives or fabricates false evidence in any other case, shall be punished with imprisonment of either description for a term which may extend to three years, and shall also be liable to fine.

Explanation 1 : A trial before a Court-martial is a judicial proceeding.

Explanation 2 : An investigation directed by law preliminary to a proceeding before a Court of Justice, is a stage of a judicial proceeding, though that investigation may not take place before a Court of Justice.

Illustration

A, in an enquiry before a Magistrate for the purpose of ascertaining whether Z ought to be committed for trial, makes on oath a statement which he knows to be false. As this enquiry is a stage of a judicial proceeding, A has given false evidence.

Explanation 3 :An investigation directed by a Court of Justice according to law, and conducted under the authority of a Court of Justice, is a stage of a judicial proceeding, though that investigation may not take place before a Court of Justice.

Illustration

A, in any enquiry before an officer deputed by a Court of Justice to ascertain on the spot the boundaries of land, makes on oath a statement which he knows to be false. As this enquiry is a stage of a judicial proceeding. A has given false evidence.

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Section 228

Intentional Insult Or Interruption To Public Servant Sitting In Judicial Proceeding.
Whoever intentionally offers any insult, or causes any interruption to any public servant, while such public servant is sitting in any stage of a judicial proceeding, shall be punished with simple imprisonment for a term which may extend to six months, or with fine which may extend to one thousand rupees, or with both.

So the proceedings are judicial only to the extent as seen above. That is if truth is not stated or the authority is insulted etc,.

 

Then let us get back to our question – what is the punishment, if any, for disobeying summons?

 

In ITTY v ASSISTANT DIRECTOR - 1992 (58) E.L.T. 172 (Ker.), the Hon'ble HIGH COURT OF KERALA held that failure to attend before the Enforcement Officer was not an offence under section 56 of the FERA and the conviction was set aside.

This view was upheld by the Hon'ble HIGH COURT OF MADRAS in C. SAMPATH KUMAR v ENFORCEMENT OFFICER, MADRAS - 1999 (105) E.L.T. 563 (Mad.)

In this context a look at section 56 of the FERA would be relevant.

 

56 . Offences and prosecutions. - (1) Without prejudice to any award of penalty by the adjudicating officer under this Act, if any person contravenes any of the provisions of this Act [other than Section 13, clause (a) of sub-section (1) of Section 18 (Section 18A) clause (a) of sub-section (1) of Section 19, sub-section (2) of Section 44 and Sections 57 and 58], or of any rule, direction or order made thereunder he shall, upon conviction by a Court, be punishable, -

in the case of an offence the amount or value involved in(i) which exceeds one lakh of rupees, with imprisonment for a term which shall not be less than six months, but which may extend to seven years and with fine :

Provided that the Court may, for any adequate and special reasons to be mentioned in the judgment, impose a sentence of imprisonment for a term of less than six months;

in any other case, with imprisonment for a term which may(ii) extend to three years or with fine or with both."

So section 56 provides for punishment for contravention of any of the provisions of the ACT…. ( of course the Kerala and Madras high Courts held that non compliance of summons under section 40 is not a contravention within the meaning of section 56)

 

Recently the Hon'ble Supreme Court had occasion to consider this vital question in
Enforcement Directorate v M. Sambasiva Rao – 2001(134) ELT 605 (SC).
The Court held that,

" The Act (FERA) having been enacted in the interest of national economy, the provisions thereof should be construed so as to make it workable and the interpretation given should be purposive and the provisions should receive a fair construction without doing any violence to the language employed by the legislature …………… on a plain literal meaning being given to the language used in section 56 of the Act, we are of the considered opinion that violation or contravention of the directions given under the summons under section 40 would come within the purview of section 56 and therefore would be punishable thereunder…."

 

Thus non compliance of summons under the FERA was punishable because section 56 provided for punishment for contravention of any of the provisions of the Act or of any rule, direction or order made thereunder.

 

What then is the position under the Central Excise Act?

 

Section 9 dealing with Offences, which reads as

 

Section 9 . OFFENCES AND PENALTIES :- (1) Whoever commits any of the following offences, namely : -

 

(a) contravenes any of the provisions of section 8 or of a rule made under clause (iii) or clause (xxvii) of sub-section (2) of section 37;

 

(b) evades the payment of any duty payable under this Act;

 

(bb) removes any excisable goods in contravention of any of the provisions of this Act or any rules made thereunder or in any way concerns himself with such removal;

 

(bbb) acquires possession of, or in any way concerns himself in transporting, depositing, keeping, concealing, selling or purchasing, or in any other manner deals with any excisable goods which he knows or has reason to believe are liable to confiscation under this Act or any rule made thereunder;

 

(bbbb) contravenes any of the provisions of this Act or the rules made thereunder in relation to credit of any duty allowed to be utilised towards payment of excise duty on final products;

 

(c) fails to supply any information which he is required by rules made under this Act to supply, or (unless with a reasonable belief, the burden of proving which shall be upon him, that the information supplied by him is true) supplies false information;

 

(d) attempts to commit, or abets the commission of, any of the offences mentioned in clauses (a) and (b) of this section;

 

shall be punishable, -

 

(i) in the case of an offence relating to any excisable goods, the duty leviable thereon under this Act exceeds one lakh of rupees, with imprisonment for a term which may extend to seven years and with fine :

 

Provided that in the absence of special and adequate reasons to the contrary to be recorded in the judgment of the Court such imprisonment shall not be for a term of less than six months;

 

(ii) in any other case, with imprisonment for a term which may extend to three years or with fine or with both.

 

 

Here we do not have punishments for contravention of the rules or directions or even the Sections of the Act. Only certain offences are punishable and non compliance with summons is not one of them. While FERA which is no more in existence had a provision, remote though, it appears that the Central Excise Act (for that matter even the Customs Act) does not have any provision to bring to book persons who do not respond to the summons.

 

Is there a way out?

 

May be that really time tested and one of the oldest Acts, the Indian Penal Code provides an answer. Section 174 of the Indian Penal Code reads,

 

"174 NON-ATTENDANCE IN OBEDIENCE TO AN ORDER FROM PUBLIC SERVANT.

Whoever, being legally bound to attend in person or by an agent at a certain place and time in obedience to a summons, notice, order or proclamation proceeding from any public servant legally competent, as such public servant, to issue the same, intentionally omits to attend at that place or time, or departs from the place where he is bound to attend before the time at which it is lawful for him to depart, shall be punished with simple imprisonment for a term which may extend to one month, or with fine which may extend to five hundred rupees, or with both;

or, if the summons, notice, order or proclamation is to attend in person or by agent in a Court of Justice, with simple imprisonment for a term which may extend to six months, or with fine which may extend to one thousand rupees, or with both."

 

Though IPC may come to rescue, I suggest that Section 9 of the Central Excise Act and Section 135 of the Customs Act should be suitably amended to include non compliance of summons also as punishable offence under the respective sections.

EXCISE LAW TIMES – 01.05. 2002 – A 207