1. Central Excise Officers visited the factory of the appellants, M/s.
Hindustan Lace Manufacturing Corporation Limited on 26.7.1979 and, on inspection of the accounts of the appellants, found the value of excisable goods manufactured by them during the years 1976-77 and 1977-78 had in each year exceeded Rs. 30 lakhs. On adjudication, the Collector held that the turnover during the year 1976-77 was less than Rs. 30 lakhs and, therefore, no duty was payable for the period 19.6.1977 to 31.3.78 but he demanded duty in respect of the goods removed during the period 1.4.1978 to 31.3.1979 and in addition, imposed a penalty of Rs. 20,000/-. The appellants preferred an appeal to the Central Board of Excise & Customs. The order of the Board is dated 20.12.1980. In the order it was noted that during the personal hearing the appellants expressed their willingness to pay duty but prayed for remission of the penalty. On that basis the Board, in deciding the appeal, upheld the order of the Collector with reference to demand of duty but, with reference to the penalty, set aside the same, cautioning the appellants to be more careful in future. It is against the said order dated 20.12.1980 that the appellants had preferred a revision petition to the Government which, on transfer, is being disposed of under the present order as an appeal before this Tribunal.
2. Shri R.R. Gupta, Advocate appeared for the appellants, the respondent Collector being represented by Shri H.L. Verma, Senior Departmental Representative.
3. When the appeal came up for hearing on 20.12.1984, a doubt was felt whether in view of the observation in the order of the Board that the appellants had expressed willingness to pay the duty and, thereafter, the penalty had been set aside, anything survived for decision by the Tribunal. Shri Gupta at that stage relied upon the contention in paragraphs 7 and 8 of the revision petition where it had been mentioned that the learned Member of the Board who heard the matter had possibly misunderstood the appellants, when it was submitted on their behalf that they were willing to pay duty if duty was payable and that they had not paid duty under a bona fide impression that the same was not payable. In that connection, Shri Gupta relied upon an affidavit filed by Shri S.L. Sureka, Director of the appellants, who was present at the hearing before the Board. But as there was obviously a typographical error in the said affidavit, Shri Gupta wanted time to file a revised affidavit from Mr. Sureka. As the appellants had been represented by Shri H.L. Banerjee. Consultant, during the hearing of the appeal before the Board, it was pointed out to him that he would be the person in the best position to explain what had happened in the hearing. Shri Gupta therefore wanted time to obtain an affidavit from Shri Banerjee also, if possible. Accordingly, the appeal was adjourned to today and now the affidavit of Shri H.L. Banerjee has been filed though no revised affidavit from Shri Sureka has been filed. In this affidavit of Shri Banerjee he had stated that in answer to a query from the Member hearing the appeal it was submitted that the appellants were willing to pay duty if any duty was payable and that neither Shri Banerjee nor Shri Sureka had conceded that the appellants were liable to pay duty on the shoe laces.
4. On 1.3.1985 a telegram was received in the Registry seeking adjournment of today's hearing. The ground given was "financial constraint" and it was requested that the appeal might be fixed along with an appeal of another party before another Bench of the Tribunal (which apparently has not yet been listed for hearing) so that the appellants might be able to avail themselves of the services of their Consultant, Shri H.L. Banerjee. As the matter had been listed for today in consultation with the learned advocate of the appellants, Shri R.R.Gupta, who had appeared for them on the previous occasions, and it had also been specifically directed that no other heavy matter shall be listed today, the appellants were telegraphically informed that they should appear for hearing today in accordance with the notice given to them.
5. On the matter being called today, Shri R.R. Gupta was again present, and he stated that he was appearing for the appellants consequent on the rejection of their request for adjournment.
6. We have heard Shri Gupta for the appellants and Shri Verma for the respondent. The observations of the Board in their order dt. 20.12.1980 at paragraphs 8 and 10 are as follows: Para 8 : During the personal hearing the appellants expressed their willingness to pay the duty. They, however, pleaded that they were under a bona fide impression that they were not liable to pay duty under Item 68 of Central Excise Tariff on the shoe laces and, therefore, the order of imposition of penalty should be remitted.
Para 10 : As the appellants have themselves agreed to pay the duty at appropriate rates on the shoe laces under Tariff Item 68 and also on merits, no order about the liability to duty is being passed.
This part of the Collector's order is, therefore, upheld and confirmed.
The observations are clear and categorical to the effect that during the hearing the appellants had expressed their willingness to pay duty at appropriate rates on the shoe laces under Tariff Item 68. In view of this clear statement in the order under appeal, as to what had transpired during the hearing of the appeal, we are satisfied that it would not be open to the appellants now to contend that the statement in the order of the Board as to what had happened during the hearing is not correct.
7. We may in this connection refer to two decisions: In King Emperor v.Barendra Kumar Ghose AIR 1924 Calcutta 257 the full Bench of the Calcutta High Court had to consider the question, whether the accused had pleaded guilty to the charge under Section 395 I.P.C. as had been noted by the trial Judge, or whether he had pleaded guilty with the reservation that he did not cause hurt to the postmaster. The High Court held that it is the record of the Court as to what had happened in Court that should be accepted as final and that the accused cannot be allowed to challenge that entry as to what had happened in Court. It was observed at page 306 "I think the true rule is that we have no more power of contradicting the statement of a learned Judge in a matter of this description than we have the power of contradicting any allegation which may appear upon the record". It was again observed at page 317 as follows: There is only one other matter to which I desire to refer. That Judges exercising Original, Civil or Criminal Jurisdiction should be compelled to transact business without the assistance of shorthand writers is false economy, and an anachronism which I trust in the near future will come to an end. But shorthand writers are not infallible, and these proceedings emphasise the importance of rigidly maintaining the rule that a statement by a learned Judge as to what took place during the course of a trial before him is final and decisive : It is not to be criticised or circumvented ; much less is to be exposed to animadversion.
8. The Madras High Court had to consider the same question in Katta R.Venkatesayya and Anr. v. Mohammed Ghouse Saheb AIR 1944 Madras 450 An order passed by a subordinate Court, noted to be on the basis of consent, was challenged in the High Court on the ground that no consent had been given. The High Court observed that the statement of the learned Judge as to what had happened in Court was conclusive. Two earlier judgments were relied upon and quoted in support of that conclusion; they were: (I) The statement of the Judge, who presides at a trial, whether it be in a criminal or civil case, is, as to what has taken place at the trial, conclusive. Neither the affidavits of bystanders, nor of jurors, nor the notes of counsel, nor of shorthand writers are admissible to controvert the notes of statement of the Judge. 10 Bombay High Court Reporter 75.
(II) he question is, whether the affidavits of bystanders are to be admitted, to prove that the Judge, who presided at a trial is guilty of mistake as to what passed. If such affidavits were now received, it would be the first instance of such a practice, and would produce the greatest injury to the administration of justice. 110 E.R. 1092.
9. The same principle would apply in respect of the hearing before the Central Board also which was sitting as a quasi-judicial authority in hearing the appeal. Its observation in paragraphs 8 and 10 of its order as extracted earlier cannot be allowed to be challenged as not correctly reflecting as to what had happened in the hearing before the Board.
10. Further, even the affidavits of Shri Banerjee and Shri Sureka are to admit that the question of liability for payment of duty did, in fact, arise during the hearing before the Board and, at that stage, a concession was made about liability for payment, though it is alleged that the concession made was that duty would be paid if it is payable.
We fail to understand even the need for making any concession at all in the said manner. If duty was payable in law no concession would be required from the appellants that it would in such a situation be paid.
We are satisfied that the concession regarding liability for payment of duty could not have been made with any such qualification but, as noted in the order of the Board, it should have been without any such reservation. Further, as earlier mentioned, we are satisfied that in view of the clear observations in the order of the Board as to the nature of the concession that was made during the hearing of the appeal the appellants cannot be permitted to state now anything to the contrary.
11. Liability for duty is a mixed question of fact and law and, in the present case, it was mainly a question of fact. Therefore, in view of the concession made before the Board during the hearing the appellants cannot now be permitted to contend anything to the contrary here.
12. In the result, it is not necessary to go into the question of the dispute regarding classification or liability for payment of duty in terms of the notification mentioned earlier. The order of Board on that matter is not liable to be canvassed in this appeal but will have to be confirmed. So far as the penalty imposed by the Collector is concerned, the same had been set aside by the Board itself. We therefore hold that in effect nothing survives for our decision in this appeal. The same is accordingly dismissed.