IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH. C.W.P. No.19969 of 2008 Date of decision: 26.11.2008 M/s Samrat Plywood Ltd. & ors. -----Petitioners Vs. Union of India and another. -----Respondents CORAM:- HON'BLE MR JUSTICE ADARSH KUMAR GOEL HON'BLE MR JUSTICE L.N. MITTAL Present:- Mr. R.S. Cheema, Sr.Advocate with Ms. Tanu Bedi, Advocate and Mr. R. Santhanam, Advocate for the petitioners. ----- ORDER 1. By this petition, the petitioners seek quashing of (i) search and seizure proceedings conducted on 21.3.2005 as per Recovery Memo (Annexure P-2), (ii) show cause notice dated 27.4.2007 (Annexure P-3), under Section 11A, 11B and 11C of the Central Excise Act, 1944 read with Rule 25D of the Central Excise Rules, 2002 and (iii) notification dated 4.5.1963 issued under Section 12 of the Central Excise Act, making Section 105 of the Customs Act, 1962 applicable to the Excise Act and a direction to segregate imposition of liability on petitioners No.1 and 2 and to provide effective and substantial opportunity of cross-examining all witnesses, sought by the petitioners. C.W.P. No.19969 of 2008 2. Case set out in the petition is that the petitioner No.1 was incorporated as a company and was manufacturing goods covered under heading 4408.90 of the Central Excise Tariff. Petitioner No.2 was also incorporated as a company and was dealing in manufacturing of plywood Board etc. Petitioner No.3 was Director of petitioners No.1 and 3. Raid was conducted on 21.3.2005 and certain documents were seized. Thereafter, statements of various persons were recorded from 21.3.2005 to 19.2.2007. A show cause notice was issued, requiring the petitioners to show cause, inter-alia, why excise duty be not imposed with interest and penalty. The petitioners sought various documents to prepare their defence and also sought cross- examination of some persons. Some of the persons were allowed to be cross-examined, while request of the petitioners was turned down for others. 4. We have heard learned counsel for the petitioners. 5. First submission in support of the petition is that the impugned notification dated 4.5.1963 was ultra vires the powers under Section 12 of the Central Excise Act, which was confined to incorporating provision of Customs Act, 1962 relating to levy and exemption from Customs duties, drawback of duty, warehousing, offences and penalties, confiscation and procedure relating to offence and appeal. The scope of said power did not cover the subject of search. The subject matter of search was separately provided for under Section 18 of the Customs Act to be in accordance with the provisions of Code of Criminal Procedure. 2 C.W.P. No.19969 of 2008 6. We are unable to accept the submissions. 7. No doubt, procedure for search is the one provided in the Code of Criminal Procedure, but the provisions of Section 12 cannot be held to exclude the subject of search which is not foreign to machinery for levy of duty. There cannot be water-tight separation of subject matter dealt with in different statutory provisions and the Statute has to be read as a whole. The provision of Section 12 have to be liberally construed, as may be necessary to give effect to the objects of the Statute. We are, accordingly, unable to hold that notification dated 4.5.1963 is beyond the to scope of Section 12. 8. Coming to the submission that a direction should be issued for splitting up the individual responsibilities of the two companies involved and for giving opportunity of cross-examination in the manner sought by the petitioners, we are of the view that, at this stage, when proceedings are pending adjudication before the competent authority, interference of this Court will not be appropriate. We leave the question, whether defence is prejudiced by denial of cross-examination or by liability of the two companies not being segregated, open to be gone into at appropriate stage. 9. The petition is, accordingly, dismissed. 10. Dasti on payment. ( ADARSH KUMAR GOEL ) JUDGE November 26, 2008 ( L. N. MITTAL ) ashwani JUDGE 3