ZUNJARRAO BHIKAJI NAGARKAR versus UNION OF INDIA AND ORS.

Citation: [1999] SUPP. 1 S.C.R. 87 · Decided: 06-08-1999 · Supreme Court of India · Bench: S. SAGHIR AHMAD · Disposal: Appeal(s) allowed

Judgment (excerpt)

ZUNJARRAO BHIKAJI NAGARKAR 
A 
v. 
UNION OF INDIA AND ORS. 
AUGUST 6, 1999 
[S. SAGHIR AHMAD AND D.P. WADHWA, JJ.] 
B 
Servi~ law: 
Central Civil Services (Classification, Control & Appeal) Rules, I965:-
Rule I 4-Disciplinary Proceedings-Initiation of -On the basis of vague C 
and indefinite information-Held, not correct, suspicion has no role to play 
in such matter. 
MISCONDUCT : Allegation of-Against quasi-judicial authority-On 
the basis of wrong exercise of jurisdiction-Held, to maintain any charge D 
sheet against a quasi judicial authority something more has to be alleged 
than a mere mistake of law. e.g., in the nature of some extraneous 
consideration-Wrong exercise of jurisdiction cannot form basis for initiating 
disciplinary proceedings, since the wrong can be corrected in appeal. 
ACADEMY : For training probationers-Posting of person charged of E 
misconduct-Not proper-Best talent to be sent to academy-Posting to 
Academy should be considered as an honour and not punishment. 
CENTRAL EXCISE ACT 1944 : Section l IAC.-Central Excise Rule, 
173 Q-Levy of penalty-Whether discretionary-Held, No. It is only the 
amount of penalty, which is discretionary. 
F 
PRACTICE & PROCEDURE : Pleading-Use of strong language-By 
the State-Held, State not being a private litigant strong language should 
be avoided. 
WORDS & PHRASES: Liable-Meaning of 
Appellant, a Commissioner of Central Excise, in an adjudication 
proceeding against an assessee, did not impose penalty on him under rule 
173 Q of Central Excise Rules, despite holding that the assessee had 
clandestinely manufactured and cleared excisable goods wilfully and avoided 
87 
G 
H 
88 
SUPREME COURT REPORTS [1999] SUPP. I S.C.R. 
A excise duty, and despite ordering confiscation of the goods. 
The Central Board of Excise and Customs passed an order u/s 35E of 
the Central Excise Act, directing the appellant to file an appeal to the 
Appellate Tribunal on the question whether his order against the assessee 
was correct, legal and proper and whether he ought to have imposed penalty. 
B Appeal was accordingly filed which is pending. 
Thereafter, inquiry was proposed against him on the allegation that in 
his order against the assessee, by not imposing penalty, he had favoured him. 
The memo of charge read with imputation of misconduct only alleged that 
C he was in error by not having imposed penalty on the assessee. No allegation 
of corrupt motive was there. The Respondent did not want to produce any 
witnesses and the list of documents pertained only to record of the case. 
Appellant challenged the proposed inquiry, before the Central 
Administrative Tribunal, which was dismissed. A writ petition against the 
D same in High Court was also dismissed. 
E 
F 
In appeal to this Court, appellant c"Ontended that provisions of Rule 
J 73Q are not mandatory and that the adjudication order being quasi judicial 
in nature, any error committed therein could be corrected by recourse to the 
Appellate Forum. 
Allowing the appeal, this Court 
HELD: 1.1. The contention that levy of penalty was not mandatory 
under Rule 173Q and it became so after insertion of section 11 AC in the 
Central Excise Act does not appear to be correct. In both Rule t 73Q and 
s~~tion 11 AC the language is somewhat similar. Under rule l 73Q apart 
from confiscation of the goods the person concerned is liable to penalty. 
Under Section l IAC, the word "also" has been used but that does not appear 
to be quite material in interpreting the word 'liable' used both in rule l 73Q 
and section llAC, and if liability to pay penalty has to be fixed by the 
G adjudicating authority. [104-F; 105-A] 
1.2. While examining Rule 173Q, it does not appear that apart from 
the offending goods which are liable to confiscation, the person concerned 
with that shall be liable for penalty upto the amount specified in the Rule. 
The argument that levy of penalty is discretionary, cannot be accepted. It is 
H only the amount of penalty, which is discretionary. Both things are necessary 
..,. . 
• 
Z. B."NAGARKAR v.U.0.1. 
89 
(1) goods are liable to confiscation and (2) person concerned is liable to A. 
penalty. The penalty to be imposed has to be in commensurate with the 
gravity of the offence and the extent of the evasion. [105-C-D) 
State of Madhya Pradesh v. Bharat Heavy Electricals, (1998) 99 ELT 
33 SC and Rajasthan Pharmaceuticals Laboratory, Bangalore and Ors. v 
State of Karnataka, [1981)1SCC 645, referred to • 
B 
T

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