AJMAL MIAN, J.--By this common judgment we intend to dispose of the above two petitions, which involve common points of facts and law.
2. The petitioners in the above two petitions are partnership firms. One is under the name and style of Messrs Spinzar Snacks and the other is Messrs Spinzar Snack Bar. In the above firms there may be some common partners. Both the petitioners applied- for exemption from the payment of excise duty in terms of Item 13.01 of the Part II of the Ist Schedule to the Central Excises and Salt Act, 1944 (herein referred to as the Act). The above applications were considered by Respondent No. 3 in terms of Clause (B) (a) iii) which provides that the Assistant Collector of Central Excise will determine the annual turn-over for the purpose of exemption in order to find out, whether the annual turn-over is less than Rs. 5,00,000 or it exceeds Rs. 500,000. It may be observed that exemption from the payment of excise duty of excisable services was allowable under the above clause if the annual turn-over of a restaurant in the financial years in question was less than Rs.
5,00,000. Respondent No. 1, in order to decide the above question, visited the petitioner's restaurants and took over possession of the daily Cash Memo. Books and other books maintained and on the basis of the above documents he concluded that the annual turn-over for the financial years in question in respect of both the petitioners' restaurants was over Rs. 5,00,000 and therefore, he declined the applications and ordered that the petitioners were liable to pay excise duty on the excisable service and were also liable to obtain licence. In Constitutional Petition No. D-788 of 1983 order dated 28-2-1.979 has been impugned, whereas in Constitutional Petition No. D-793 of 1983 the order dated 17-2-1979 has been impugned.
3. The petitioners being aggrieved by the above orders, have filed the present petitions. In support of the above petitions Mr. G.M. Saleem, learned counsel for the petitioners has urged as follows:--
(i) That since the seizure of the Cash Memo Books and the other accounts books was illegal, the finding as to the annual turn-over for the financial years in question is coram non judice.
(ii) That the respondent No. 3 was required to determine the annual turn---over on the basis of the actual sales and not on the basis of hypothesis.
(iii) That in any case respondent No. 3 was required to exclude the holidays when the petitioners' restaurants remained closed.
4. In furtherance of the above first submission that since the seizure of the Cash Memo Books and the other accounts books was illegal, the finding as to the annual turn-over for the financial years in question is coram non judice, it may be observed that he has referred to Rules 197 to 209 and it has been urged by him that under Rule 197 the respondent No. 3 could have entered upon the petitioners' restaurants' premises and could have examined the documents, but he head no power to seize the same. To reinforce the above submission, he has also referred to Rules 200 and 203 wherein seizure has been expressly provided for in respect of excisable goods and contraband articles.
5. In our view, the reference to above rules 200 and 203 is out of context, as they relate to the seizure of excisable goods and contrabands. We are inclined to hold that in order to determine the question, whether the petitioners qualify for exemption under above item 13.01 of Part 11 of the Ist Schedule of the Act, the respondent No. 3 has been authorised to hold inquiry. It is an admitted position that the petitioners failed to produce their account books and other documents in order to show actual sales for the financial years in question and therefore, one of the bases for determining the above question could be the daily sale of certain period of the petitioners' restaurants and for doing so, it was necessary for the respondent No. 3 to have those documents with him. We are, therefore, of the view that the fording recorded by the respondent No. 3 on the question of annual turn-over the basis of the above documents cannot be termed as coram non judice.
6. Adverting to the second submission of Mr. G.M. Saleem that the respondent No. 3 under the Act and the Rules was required to determined the annual turn-over on the basis of the actual sales of the financial years in question, it will suffice to observe that since the petitioners had failed to produce the account books and other related documents, there could not have been any actual determination in the above manner, The petitioners are to blame themselves,
7. As regards the third submission of Mr. G.M. Saleem that the respondent No. 3 was obliged to exclude the holidays on which the petitioners' restaurants remained closed, it may be stated that the question for determination before respondent No-3 was, whether the annual turn-over of the financial years in question was more than the amount provided for the exemption and not the question how much excise duty was due and payable by the petitioners. In case the respondent No. 3 determines the question of liability as to the payment of the excise duty for the financial years in question, it will be open to the petitioners to produce reliable evidence before the respondent No. 3 to show on how many days the petitioners' restaurants factually remained closed. In our view, this point is not covered by the present petitions.