1 IN THE HIGH COURT OF BOMBAY AT GOA CRIMINAL REVISION APPLICATION NOS. 15, 18 AND 19 OF 2008 CRIMINAL REVISION APPLICATION NO. 15 OF 2008 Shri Shripad Talaulikar, the then UDC, O/o the Commissioner of Excise, & presently Inspector of Excise, Government of Goa, R/o A/3, Jerry Apartment, Shanti Nagar, Ponda, Goa. ... Applicant versus 1. State through CBI Altinho-Panaji-Goa. 2. Shri Moducorra B. N. Desai Alias MBN Desai, the then Superintendent of Excise(Retired), Government of Goa, R/o Flat No-5, 1st floor, Var-Mahalaxmi Apartments, Comba, Margao, Goa. 3. Shri Eric Bosco Menezes, Managing Director, M/s Colfax Laboratories(India) Ltd. Rua de Ourem, Panaji Goa. R/o H.No.156, Altinho, Mapusa Goa. 4. Shri Krishna Narayan Lawande, the then Director, M/s PJM Pharmaceuticals Pvt. Ltd. Rua de Ourem, Panaji, Goa. R/o Kanchanjunga, 4th floor, Gaikwad Nagar, Aundh, Pune-7, Maharashtra. ... Respondents 2 Mr. Arun Bras De Sa, Advocate for the Applicant. Mr. K. Sudhakar, Dy. Legal Advisor CBI and Special Public Prosecutor for Respondent No.1. CRIMINAL REVISION APPLICATION NO. 18 OF 2008 Shri Eric Bosco Menezes, Residing at House No. 156, Altinho, Mapusa Goa. ... Applicant versus 1. The State Through C.B.I., Altinho Panaji Goa. 2. Shri Maducora B. N. Dessai, Superintendent of Excise, (Retired) residing at Flat No.5 First Floor, Var Mahalaxmi Apartments, Comba, Margao Goa. 3. Shri Shripad Talaulikar, Inspector of Excise, Government of Goa, Residing at A/3 Jerry Apartment, Shantinagar, Ponda, Goa. 4. Shri Krishna Narayan Lawande, Residing at Kanchanjunga, 4th Floor, Gaikwad Nagar, Aundh, Pune 7 – Maharashtra. ... Respondents Mr. L. Chari, Senior Advocate with Mr. J. Lele, Advocate for the Applicant. Mr. K. Sudhakar, Dy. Legal Advisor, CBI and Special Public Prosecutor for Respondent No.1. Mr. R. V. Kamat, Advocate for Respondent No.2. 3 CRIMINAL REVISION APPLICATION NO. 19 OF 2008 Shri Krishna Narayan Lawande, Residing at Kanchanjunga, 4th Floor, Gaikwad Nagar, Aundh Pune 7 – Maharashtra. ... Applicant versus 1. The State Through C.B.I., Altinho, Panaji Goa. 2. Shri Maducora B. N. Dessai, Superintendent of Excise, (Retired) residing at Flat No.5 First Floor, Var Mahalaxmi Apartments, Comba Margao Goa. 3. Shri Shripad Talaulikar, Inspector of Excise, Government of Goa, residing at A/3 Jerry Apartment, Shantinagar, Ponda, Goa. 4. Shri Eric Bosco Menezes, Director of M/s Colfax Laboratories (India) Ltd., Rua de Ourem, Panaji Goa, Residing at House No.156, Altinho, Mapusa, Goa. ... Respondents Mr. S. Singbal, Advocate for the Applicant. Mr. K. Sudhakar, Dy. Legal Advisor, CBI and Special Public Prosecutor for Respondent No.1. CORAM : N. A. BRITTO, J. 4 DATE : 4TH AUGUST, 2008. J U D G M E N T These criminal revision applications are directed against the Order dated 26-10-2007 of the learned Special Judge, Panaji, by which charge has been ordered to be framed against the accused under Sections 420 I.P.C. and Section 13(2) r/w Section 13(12)(d) of the Prevention of Corruption Act, 1988 r/w Section 120-B I.P.C. (They have been filed by A-2 to A-4 in Special Case No. 2 of 2003). 2. The gravamen of the charge against the said accused is that they in furtherance of a criminal conspiracy obtained pecuniary advantage in the sum of Rs.92,43,684.08 which was the duty payable on “Blue Stratos After Shave Lotion” at 100% advalorem for the period from 1-4-1989 to 11-3-1991 which was manufactured by M/s. PJM Pharmaceuticals on loan licence from M/s. Colfax Laboratories of which A-4/Krishna N. Lawande and A-3/Eric Bosco Menezes were the Director and Managing Director, respectively. In the hierarchy of the Excise Department, the Department is headed by an Excise Commissioner and below him there is an Assistant Commissioner, Superintendent of Excise, Head Clerk and an U.D.C. At the relevant time, Shri Lalmalsawma was the Commissioner of Excise who took the controversial decisions on 21-9-1989 that the said “Blue Stratos After Shave Lotion” being a toilet preparation should be charged to excise duty at 100% advalorem but thereafter on 12-10-1989 approved the proposal to levy duty at Rs.10/- per proof litre after the maximum chargeable 5 price was indicated inclusive of the said duty of Rs.10/- per proof litre. He was not prosecuted as no sanction to prosecute him could be obtained from the Central Government and it is otherwise submitted that the Central Government has proposed some other action to be taken as against him. Shri S. V. Bhadri was the then Assistant Commissioner of Excise but he was not prosecuted as an accused because he expired. A-1/Shri Moducora B. N. Desai was the Superintendent of Excise who had communicated the said decision dated 29-1-1985 that 100% advalorem duty was payable on the said “Blue Stratos After Shave Lotion”. He has not challenged the said impugned Order dated 26-10-2007. Shri Florencio Cota was the Head Clerk and he is cited as prosecution witness. Shri Govind Suryaji Nachinolkar, the Excise Inspector who communicated the second decision by letter dated 12/10/1989 is also stated to have expired. A-2/Shri Shripad Talaulikar was the U.D.C at the relevant time. 3. As can be seen from the impugned Order, M/s. PJM Pharmaceuticals Ltd. is a sister concern of M/s. Colfax Laboratories Ltd. After some correspondence, M/s PJM Pharmaceuticals got a license to manufacture the said “Blue Stratos After Shave Lotion” from the Drugs Controller in the premises of M/s. Colfax Laboratories and the Drugs Controller had not given license to manufacture the same as a medicinal product. The learned Special Judge has also stated that when the application dated 2-2-1989 from M/s. PJM Pharmaceuticals came to the Commissioner of Excise for no objection certificate to manufacture the said lotion in the premises of M/s. Colfax Laboratories the position which was 6 clearly understood was that the said lotion would be a toilet or cosmetic product and the duty on which would be payable at 100% advalorem and this was communicated by letter dated 21-9-1989. The other reasons for ordering the framing of charge are found in paras 8 and 9 of the impugned Order. 4. Be that as it may, Mr. L. Chari, the learned Senior Counsel on behalf of A-3/Shri Eric Bosco Menezes submits that there is nothing which has come on record to link his client with the allegations of defrauding the Government. He further submits that the excise duty of Rs.10/- per proof litre was passed on to the consumers and it is nobody's case that 100% advalorem duty was charged to the consumers and was not paid to the Government. Learned Senior Counsel further submits that it is not the case that A-3/Shri Menezes had approached the said Commissioner or any of the other public servants and influenced them or paid any gratification. He further submits that there was absolutely no connection between A-3/Shri Eric Bosco Menezes and A-4/Shri Krishna Narayan Lawande to say that there was any conspiracy. Learned Senior Counsel further submits that neither of the Companies of which A-3/Shri Menezes was the Managing Director and A-4/Shri Lawande, the Director have benefited by charging duty at Rs.10/- per proof litre and by not charging 100% advalorem duty on the said lotion. Mr. Arun Bras De Sa, learned Counsel on behalf of A-2/Shri Shripad Talaulikar submits that he was a mere U.D.C. and did everything as per his duty and that he was no authority to charge the duty either on terms of proof litre basis or advalorem and the decision to 7 charge the same was that of the Commissioner. Learned Counsel further submits that the Applicant, A-2/Talaulikar has not gained anything. 5. Mr. Singbal, learned Counsel on behalf of A-4/Shri Lawande has submitted that his client did nothing more than to make an application for price approval and making an application is no offence. 6. On the other hand, the learned Special Public Prosecutor Mr. K. Sudhakar submits that by not paying duty at 100% advalorem pecuniary advantage was caused to M/s. PJM Pharmaceuticals of which A-4/Shri Lawande was a Director and of which M/s. Colfax Laboratories was a sister concern and A-3/Shri Menezes was the Managing Director. He further submits that both the said Companies are sister concerns and it is for that reason that M/s Colfax Laboratories had submitted the letter dated 3-10-1989. He further submits that in case the letter dated 21-9-1989 was brought to the notice of the Excise Inspector, Ponda, then he would have proceeded to charge the excise duty on the said product at 100% advalorem basis. 7. The documents collected, and the statements recorded, clearly show that on 21-9-1989 permission was granted by the Commissioner of Excise to M/s. PJM Pharmaceuticals for manufacturing the said lotion as a cosmetic product in the premises of M/s. Colfax Laboratories and the approval granted on 21-9-1989 and communicated by A-1/Shri Moducora B. N. Desai was 8 to charge duty at 100% advalorem as laid down under Tariff Item No.4 of the Schedule annexed to the Medicinal and Toilet preparations(Excise Duty) Act 1955 and Rules made thereunder. However, this letter dated 21-9-1989(No.CE/4-2579- 89-90/PON/2431) signed by A-1/Shri Desai with copies endorsed to the Excise Inspector of the Excise Station at Ponda and the Excise Inspector in charge of M/s. Colfax Laboratories as well as to M/s. Colfax Laboratories was collected by A-3/Shri Menezes but copies of the same were not handed over to the authorities, namely, the Excise Inspector in charge of the Excise Station at Ponda as well as in charge of M/s. Colfax Laboratories. Had these letters collected by A-3/Shri Menezes were handed over to the said Excise Inspectors then the said Excise Inspectors were bound to collect 100% advalorem duty on the said product. On the contrary on 3-10-1989 without making any reference to the said letter dated 21-9-1989 M/s. Colfax Laboratories addressed a letter to the Excise Commissioner directly and here again not through proper channel i.e. through the Excise Inspector either in charge of M/s. Colfax Laboratories or in charge of the Excise Station at Ponda within whose jurisdiction the said factory of M/s. Colfax Laboratories was situated, on a specious plea that it was submitted directly as they had large pending order and they needed the approval of price urgently inclusive of duty at the rate of Rs.10/- per proof litre and ultimately a similar letter was issued on 9-10-1989 by A-4/Shri Lawande as Director of, and on behalf of M/s. PJM Pharmaceuticals. These letters certainly could not have come about without the meeting of minds of all concerned including A-3/Shri Menezes, the 9 Managing Director of M/s. Colfax Laboratories and A-4/Mr. Lawande, the Director of M/s. PJM Pharmaceuticals. These letters also could not have been processed without the active connivance of the dealing hand, if I may use that expression, namely, A-2/Shri Talaulikar who was the U.D.C. in the Department of Excise and whose duty it certainly must have been to point out that the proposal of 9-10-1989 could not have been accepted because of the earlier decision taken on 21-9-1989 and communicated by letter dated 21-9-1989 signed by A-1/Shri Dessai. One fails to understand, in case there was no conspiracy, how A-1/Shri Dessai, handed over the said letter dated 21-9-1989 to A-3/Shri Menezes without ensuring that the copies marked to the Excise Inspector were dispatched through proper channel and then again how the request by letters dated 3-10-1989 from M/s. Colfax Laboratories and letter dated 9-10-1989 from M/s. PJM Pharmaceuticals were again entertained directly and without the same being submitted through proper channel. One does not know what was the cost of production of the said “Blue Stratos After Shave Lotion” and what would have been its price to the consumers in case 100% advalorem duty was charged. There may be a lot of explanation which the accused would be required to give but for the present, there is strong evidence against all the accused to show that each of them acted in connivance, first by suppressing the letter dated 21-9-1989 and then entertaining the request directly contained in letters dated 3-10-1989 and 9-10-1989 and thus causing loss in the revenue in the sum of Rs.9243684.08. The impugned Order directing the framing of charge against the accused therefore 10 could not be faulted. There is no merit in these revisions. Consequently, the same are hereby dismissed. N. A. BRITTO, J. RD