Law: Central Excise Act, (I of 1944)

Section: 37

Central Excises and Salt Act (I of 1944)--- ---S. 37---Central Excise. Rules, 1944, Rr.96-W & 210---Constitution of Pakistan (1973), Art.199---Provision of R.96-W, Central Excise Rules, 1944 empowering imposition of additional duty is ultra vires of S.37(3), Central Excises and Salt Act, 1944---Provision of S.37(c) of the Act being an enabling provision does not impose any penalty. but empowers the Central Board of Revenue to make Rules for imposition of additional penalty and not additional duty---Duty can be impugned only in exercise of legislative power as provided in the Constitution and not by exercising Rule making powers by any authority or Central Board of Revenue. Section 37 of the Central Excises and Salt Act, 1944, confers power on Central Board of Revenue to make rules to carry out the purpose of the Act. Subsection (3) of Section 37 empowers the Central Board of Revenue to frame rule for imposition of fine and confiscation of goods in case where any person defaults in performance of the rules. This penalty will be without prejudice to any other action that may be taken under the Act. Therefore, independent of any action which may be taken under the Act rule can be framed for imposition of fine not exceeding   Rs.2,000 or 10 times of the duty involved whichever is higher and confiscation of the goods involved in case of breach of the Rules. Rule 37 (3) is an enabling provision which authorises the imposition of Fine and confiscation of goods independent of any other action which may be .taken under the Act against a person guilty of violation of rules. Therefore, it seems that by these provisions additional penalty can also be imposed in respect of default or breach committed by a person for which action can be taken under the Act. This interpetation finds support from the historical background of this provision. The words `without prejudice to any other action that may be taken against him under this Act' were substituted by the Finance Ordinance, 1968 for the words `where no other penalty is provided'. Therefore, before amendment where no other penalty was provided rules could be framed imposing penalty for breach of rules. By…