Jurisprudentiol – Monday's cases

By Vijay Kumar

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Accused is to be informed of his right to be searched before Gazetted Officer or Magistrate - Non-compliance vitiated entire proceedings including conviction and sentence - Accused released from jail: SC

IT is imperative on the part of the officer to apprise the person intended to be searched of his right under Section 50 of the NDPS Act, to be searched before a Gazetted Officer or a Magistrate. It is mandatory on the part of the authorized officer to make the accused aware of the existence of his right to be searched before a Gazetted Officer or a Magistrate, if so required by him and this mandatory provision requires strict compliance. The suspect may or may not choose to exercise the right provided to him under the said provision, but so far as the officer concerned, an obligation is cast on him under Section 50 of the NDPS Act to apprise the person of his right to be searched before a Gazetted Officer or a Magistrate.

Ignorance of Law: "ignorantiajurisnon excusat": Ignorance does not normally afford any defence under the criminal law, since a person is presumed to know the law. Undisputedly ignorance of law often in reality exists, though as a general proposition, it is true, that knowledge of law must be imputed to every person. But it must be too much to impute knowledge in certain situations, for example, we cannot expect a rustic villager, totally illiterate, a poor man on the street, to be aware of the various law laid down in this country i.e. leave aside the NDPS Act. This fact is also within the knowledge of the legislature, possibly for that reason the legislature in its wisdom imposed an obligation on the authorized officer acting under Section 50 of the NDPS Act to inform the suspect of his right under Section 50 to be searched in the presence of a Gazetted Officer or a Magistrate warranting strict compliance of that procedure

Income Tax

Whether when Revenue finds FDR receipts in names of employees of assessee company, showing sum as advance during search, and assessee admits on confrontation, no fault can be found with additions made u/s 69 - YES: HC

THE Income Tax Department carried out search operations u/s 132 of the Act on 28-11-1996 in the business premises of the assessee company as well as the residential premises of the Managing Director, Sri G.V.K.Rao. Apart from the books of account, documents, materials etc., the officers also found fixed deposit receipts issued by the associate company HHL in favour of various persons numbering about hundred (100) in all. Sri G.V.K.Rao, when confronted with all the material seized by the department, conceded before the officers of the Revenue in his sworn statement that the deposits found in the names of over hundred persons represented by the certificates found at the time of search actually belonged to the assessee company and offered Rs.30.00 lakhs as undisclosed income apart from offering it to tax for the block period. The issue before the Bench is - Whether when the Revenue finds FDR receipts in the names of employees of the assessee company, showing the sum as advance during a search, and the assessee admits on confrontation, no fault can be found with additions made u/s 69. And the answer goes against the assessee.

Central Excise

S. 4A - P & P Medicines - there is no provision under Notf. 2/2005-CE(NT) that abatement is to be taken from the retail sale price excluding duty - appellant working under self assessment procedure and it is their duty to compute correct AV and pay correct CE duty - non-mentioning of correct AV in letter addressed to Asstt. Commr. is willful misstatement by appellants. Extended period rightly invoked - Order upheld and appeal rejected: CESTAT

THE appellants are manufacturers of P & P Medicines which are assessed under the provisions of Section 4A of the Central Excise Act 1944 based on maximum retail price less abatement of 35% /40%. It was noticed that the appellants are not discharging the duty liability correctly under Sec.4A of the Central Excise Act and on verification of the documents it was seen that the appellants had paid duty on the basis of lower value arrived at under Sec.4A of the Central Excise Act. For the purpose of central excise duty, they had calculated the assessable value after deducting central excise duty element from maximum retail price and thereafter claimed the deduction under Notification 2/05-CE(NT) and they had not paid the duty on the value arrived at by deducting abatement from maximum retail price.

See our Columns Monday for the judgements