P. Govindan Nair, J.
1. The petitioner has impugned the order Ext. P9 passed by the Superintendent of Central Excise, Alleppey purporting to act under Rules 9(2) and 151(c) of the Central Excise. 1944, as well as the appellate order therefrom which is Ext. P12 passed by the Collector of Customs : the first respondent.
2. Briefly stated, the case against the petitioner is that he removed in contravention of Rule 151(c) biri pathi tobacco weighing 1477.50 kgs. and substituted the same with inferior type tobacco. This, it is alleged, was discovered when the Deputy Superintendent and party visited the warehouse of the petitioner and checked the stock of the accounts. They found tobacco there is 43 bags which is stated to be biri tobacco weighing 1235.8 kgs. This, it was surmised, was not the same tobacco that was transported to the warehouse under the relevant T.P. permit which is referred to and on the basis of a prima facie case the tabacco was seized. After investigation during which the petitioner was given an opportunity to state his case the order Ext. P9 was passed imposing a penalty of Rs. 50,- on the petitioner, directing him to pay the duty on 1,477.50 kgs. of biri pathi tobacco to the extent of Rs. 4,639.35 and directing confiscation of the goods seized.
3. This order has been passed on the basis that the tobacco that was seized on inspection on 30-8-1965 is not the same tobacco that was warehoused under the relevant T.P. permit. To come to this conclusion only two factors have been relied on. The description in the relevant T.P. permit that the tobacco transported is 'biri pathi' and that the entries in the processing register of the consignor show that the tobacco despatched was processed and was 'biri pathi'. On the basis of these materials it is assumed that such tobacco will not contain any khandi and pathi. The petitioner has contended that before a certain date, when biri pathi tobacco contained stems or khandi, the presence of stems and khandi were not not noted in the relative T.P. This aspect has not. been dealt in the appellate order though the point was taken before the appellate authority. There is no material whatever to indicate the normal content of stems and khandis in biri pathi tobacco. There is also no material establishing the extent of stems and khandis found in the tobacco seized. These is of course the statement of the appellate authority that biri pathi tobacco should not contain any stems or khandis. On what basis is it is so stated is not known. On this material I think to come to the conclusion that the tobacco warehoused has been removed and substituted by other tobacco is to come to a conclusion without enough material can reasonably give rise to an inference that there has been substitution. The provisions in the Central Excise Rules enabling penalty being imposed and confiscation being ordered are in the nature of penal provisions and the authorities exercising those powers enabling them to impose the penalties must have uncontrovertible material before them to show that the ingredients of those rules are made out. also think that the burden of establishing these ingredients is on the department and that no assumption can be made. Similar cases have come up before this Court and the same view has been taken. I may refer to an order of reference to a Division Bench in C.P. Nos. 2566, 2577, 2813 and 2891 of 1962 as well as the decision of the Division Bench in those cases.
4. In the light of the above. 1 set aside Exts. P9 and P12 orders and allow this petition. The fine of Rs. 50/- paid by the petitioner will be refunded to the petitioner. 1 make no direction regarding costs.