Central excise, customs duty evasion bailable offence: Court
October, 05th 2011
The Supreme Court has held that evasion of central excise and customs duties is a bailable offence and authorities cannot arrest the offender without obtaining a warrant from a competent court.
The language of the scheme of the 1944 Central Excise Act seems to suggest that the main object of the enactment was recovery of excise duties and not really to punish for infringement. The introduction of Section 9A by way of amendment reveals the thinking of the legislature that offences under the 1944 Act should be non-cognisable and therefore, bailable, said a three-judge Bench.
Writing the judgment, Justice Altamas Kabir said: Having considered the various provisions of the Act and the Code of Criminal Procedure, which has been made applicable to it, we are of the view that the offences under the 1944 Act cannot be equated with offences under the Indian Penal Code, which have been made non-cognisable and non-bailable.
The Bench, which included Justices Cyriac Joseph and S.S. Nijjar, said all offences under the Central Excise Act, 1944, and the Customs Act, 1962, are non-cognisable and are bailable.
Under the Cr.PC, a police officer had no authority to make an arrest, without a warrant, for a non-cognisable offence, the Bench pointed out.
The Bench did not agree with the submissions advanced on behalf of the Centre that the power to arrest must necessarily be vested in a Customs and Excise Officer for the efficient discharge of his functions and duties in order to prevent black money and money laundering. The Centre argued that a Customs Officer's power to arrest a person is statutory in character and cannot be interfered with.
The Bench, however, said: Such power of arrest can be exercised only in cases where the Customs Officer has reasons to believe that a person has committed an offence punishable under Sections 132, 133, 135, 135-A or 136 of the Customs Act. The power of arrest was circumscribed by objective considerations and could not be exercised on whims, caprice or fancies of the officer.
Consequently, as in the case of offences under the Central Excise Act, 1944, offences under Section 135 of the Customs Act, 1962, are bailable and if the person arrested offers bail, he shall be released on bail in accordance with the provisions the Customs Act.
In the instant case, Choith Nanikram Harchandani and others filed petitions questioning the power of authorities to arrest offenders without warrants. The court framed a common question in these petitions, whether all offences under the Central Excise Act and the Customs Act were non-cognisable and bailable offences, and answered in favour of the petitioners.