Cooperatives, including banks, not under RTI

Oct 23 2013, 03:09 IST
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SummarySetting aside a Calcutta High Court judgment in the case of Somnath Sarkar vs Utpal Basu, the Supreme Court has ruled that courts

Relaxation in dud cheques fine

Setting aside a Calcutta High Court judgment in the case of Somnath Sarkar vs Utpal Basu, the Supreme Court has ruled that courts cannot impose a fine more than twice the amount a cheque carries if it bounces.

It said that the stringent provisions in the Negotiable Instruments Act providing punishment for bounced cheques is only a mode to ensure recovery of money. Under the Act, an accused in a cheque-bounce case can be sentenced to a maximum of a year or fined twice the default amount, or both.

“… the power to levy fine is circumscribed under the statute to twice the cheque amount. Even in a case where the court may be taking a lenient view in favour of the accused by not sending him to prison, it cannot impose a fine more than twice the cheque amount. That statutory limit is inviolable and must be respected,” the apex court said, while relaxing the sentence on the defaulter.

In this case, a cheque of R69,500 issued by Sarkar bounced. While waiving his jail term of six months, the HC asked the defaulter to pay a compensation amounting to R80,000 plus twice the cheque amount (R1,49,500). However, the apex court after accepting Sarkar’s plea that he is “a man of limited financial means” reduced the liability to R80,000 as compensation to the complainant plus R20,000 as fine.

Clarity on Modvat rules

Dismissing the appeal of the department in a batch of cases led by Commissioner of Central Excise vs M/s Kay Kay Industries, the Supreme Court said that relevant provisions in the Central Excise Rules 1944 and the subsequent 1997 notification only required the manufacturer of final products to take “reasonable steps” to ensure that the inputs acquired by him are goods on which the duty has been paid.

The proviso requires 'reasonable care' and not verification from the revenue authorities whether the duty stands paid by the assessee, it said, while rejecting the department’s view that it was obligatory on the part of the assessee to ensure that the appropriate duty of excise had been paid on the inputs used in the manufacture of it final product as required under Rule 57A(6) of the Central Excise Rules.

In the lead case, Kay Kay Industries had availed deemed Modvat credit on the basis of invoices issued by supplier Sawan Mal Shibhu Mal Steel Re-Rolling Mills, which allegedly had not discharged full

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