Dilip Kumar Seth, Maharaj Sinha ( 1 ) ON the allegation that between May, 1995 and June, 1998, the assessee appellant had removed certain goods in a clandestine manner in order to avoid customs duty on the goods produced by it, a proceeding was initiated under section 11ac of the central Excise Act, in which penalty was imposed by the Assessing officer, which was affirmed by the Commissioner of Appeals. On appeal to the Custom Excise Service Tax Appellate Tribunal (CESTAT) the learned Tribunal affirmed the order of the Commissioner of Appeals, however, without giving reasons to support its findings upholding the imposition of penalty under section 11ac but then reduced the amount from Rs. 16,13,237/- to Rs. 2 Lac only on the ground that the penalty appeared to be excessive considering all-aspects of the case. The grounds: ( 2 ) THIS appeal was admitted before this Court under section 35g of the Central Excise Act on the following grounds:i) Whether the unreasoned order read with the facts and pointes of law indicates non-application of mind and non-consideration of materials on evidence produced before the Authority and as such, are perverse? ii) Whether any concession given by a Lawyer on a point of law can be binding on its clients? iii) Whether penalty under section 11 AC of the Central Excise Act, 1944 is leviable in respect of an alleged act which took place prior to the introduction and/or insertion of the said section 11ac, that is. with effect from 28th September, 1996?the appearance: ( 3 ) ELABORATE argument has been made by Mr. Dutta. Though information was sent to the learned counsel for the respondent department, he did not appear on the earlier date. Today we are informed that Mr. Dutta's clerk has informed the clerk of the learned advocate-on-record for the respondent. The matter is appearing in the list continuously and no one is appearing today to represent the respondent. Whether a concession by lawyer binds his client: ( 4 ) SO far as the second point is concerned, the same arose out of the fact that while recording the submission on behalf of the Appellant, the learned CESTAT recorded that the learned advocate submitted that the penalty of Rs. 16,13,237/- was excessive. Whether a concession by lawyer binds his client: ( 4 ) SO far as the second point is concerned, the same arose out of the fact that while recording the submission on behalf of the Appellant, the learned CESTAT recorded that the learned advocate submitted that the penalty of Rs. 16,13,237/- was excessive. However, the immediately preceding sentence records the submissions of the learned advocate on behalf of the appellant that there was no evidence to support the alleged clandestine removal. Thus the submission that the penalty was excessive preceded by the earlier sentence of denial cannot be deemed to be an admission or concession. At best it could be treated as an alternative submission. Therefore the second point does not seem to be involved in this case; and such a submission cannot be treated to be a concession on the basis of which it could be held that the learned counsel had conceded in respect of the merit of the case, which was initially denied. Section 11ac : Whether applies to Acts/omission committed before insertion of the section: ( 5 ) SO far as the third point is concerned, admittedly this section 11ac was brought in the statute with effect from 28th September, 1996. In the decision in Commissioner of Central Excise, Coimbatore v. Elgi equipments Ltd. , 2001 (128) ELT 52 (SC), the Apex Court had held that the provisions of section 11ac, inserted in the Central Excise Act, 1944, is prospective in operation and illegality committed prior to insertion of section 11ac in the Act cannot be the subject matter of the penalty under the said provision. This was so held deriving support from the decision in Mithilesh Kumari v. Prem Bilas, 1989 (2) SCC 95 . Therefore, the third question also could be answered easily that in respect of breach or illegality, if there be any, committed prior to 28th September, 1996, cannot be subjected to the provisions of section 11ac. However, those which took place on or after 28th September, 1996 can be subjected to the said provision. In this case, the period involved was May, 1995 through June, 1998. Therefore, those illegalities or breach which were committed in between 28th September, 1996 and June, 1998 can well be subjected to the provisions of section 11ac of the Act. The third question is thus answered. In this case, the period involved was May, 1995 through June, 1998. Therefore, those illegalities or breach which were committed in between 28th September, 1996 and June, 1998 can well be subjected to the provisions of section 11ac of the Act. The third question is thus answered. The finding : The scope : ( 6 ) WITH regard to the first question, it is pointed out that the transaction relating to transportation of each goods being subjected to excise duty were required to be followed by maintaining various records and documents. All these documents are interrelated with each other and that the particulars of these various documents are also mentioned in the excise invoice. Mr. Dutta had produced records containing such documents which were before the learned CESTAT and were part of the records. A cross reference of those documents would clearly show that these very goods involved in those documents were transported out of the factory through trucks. However, in some cases the registration number of the respective trucks given in those documents differed. This difference of the registration number of some trucks initially given at the time when the goods were brought out of the factory and was delivered to the consignee's point, was the pivot on which both the assessing Officer, the Commissioner of Appeals and the CESTAT relied upon. The question arises as to whether only on this difference or the discrepancy in the registration number of the trucks could be the sole ground for holding that the transaction was clandestine overlooking the other materials available on record by which this could be explained, and answered. 6. 1. Section 11ac, after it was inserted, deals with imposition of penalty which appears to be mandatory. Be that as it may, the question remain as to whether only on one doubtful situation could all the other documents be ignored and a finding could be arrived at that there was avoidance of excise duty. The penalty affects the right of a person followed by an action for the mistake or breach or violation of the law. Such an action has an adverse impact on the reputation and/or the status of the person. The penalty affects the right of a person followed by an action for the mistake or breach or violation of the law. Such an action has an adverse impact on the reputation and/or the status of the person. Therefore, it is necessary that in order to inflict or impose penalty there must be a clear finding and such finding should not be based on surmises or conjectures or in ignorance or oversight of various other documents which would prove to the contrary. Substantial question of law : Whether involved: ( 7 ) FROM the scope as discussed, it may seem that the question involved in this case relates to a finding of fact without involving any question of law; or at best it can be a question of law but can never be a substantial question of law. Having regard to the situation emerging from the facts of this case it is necessary to ascertain whether the question involved is" a substantial question of law in order to give jurisdiction to this Court to interfere with the finding of facts. 7. 1. Unless there is a clear finding of fact such penalty cannot be imposed. If it is so imposed, in that event, it would be in excess of its jurisdiction or exercise of the jurisdiction in a manner unwarranted by law. Admittedly such situation happens on many occasions and the assesses do suffer on this question and, therefore, this question has assumed a greater general public importance which is required to be answered for settling and streamlining the law on the question. Thus it becomes a substantial question of law as was held in the decision in m. Janardhana Rao v. Joint Commissioner of Income Tax, (2005)2 SCC 324 (para 14 ). Relying on the decision in Sir Chunilal V. Mehta and Sons Ltd. v. Century Spg. and Mfg. Co. Ltd. , 1962 Supp (3) SCR 549 : AIR 1962 SC 1314 , the Apex Court in M. Janardhana Rao (supra) had laid down the tests for the purpose of determining whether a question is a substantial question of law involved in the appeal with reference to section 260a of the Income Tax Act, 1961, which also provides for appeal only on a substantial question of law. The tests are: 1. whether directly or indirectly it affects substantial rights of the parties, or 2. The tests are: 1. whether directly or indirectly it affects substantial rights of the parties, or 2. the question is of general public importance, or 3. whether it is an open question in the sense that the issue is not settled by pronouncement of this Court or Privy Council or by the Federal Court, or 4. the issue is not free from difficulty, and 5. it calls for discussion for alternative view. 7. 2. Tested in the light of the above ingredients we have no doubt that the present question is also a question that can be termed as a substantial question of law. Section 35g : Re-appreciation of evidence : The present case: ( 8 ) MR. Dutta, cited the decision in Madan Lal v. Mst. Gopi and Anr. , (1980)4 SCC 255 (para 2), and Hiralal and Anr. v Gajjan and Ors. 1990 (3) SCC 285 (para 8), to support his contention for reappreciaton of the evidence in a case where the views of a tribunal is influenced by an inconsequential mater namely difference in the registration number of the trucks in some cases when there were other documents to substantiate the defence of the assessee. In the present case, we do not think that the ratio decided in those cases would be necessary to be applied. It is not a question of reappreciation of evidence so far as the present case is concerned. The facts are admitted. On record there are materials to show that these goods were transported but the only ground on which it was disbelieved was that the registration number of the trucks differed in some cases. But that alone would not be sufficient to hold conclusively that the assessee had removed goods through such trucks avoiding payment of excise duty. 8. 1. The provisions of section 11ac being penal in nature, without proper finding that there was conclusive proof that excise duty was avoided or some were -removed, no penalty could be imposed simply on the basis of mere surmise or conjecture. The Tribunal or the commissioner of appeal or the Assessing Officer was not supposed to presume things without the materials only on the basis of suspicion. The Tribunal or the commissioner of appeal or the Assessing Officer was not supposed to presume things without the materials only on the basis of suspicion. In fact, in the present case the finding that the assessee was guilty of clandestine removal of goods avoiding payment of excise duty was based only on the basis of difference in the registration number of trucks without anything else on the basis of which it was not possible for a rational man to come to such a conclusion. In his usual fairness, Mr. Dutta had taken us through the materials on record and had pointed out that there was no material on the basis of which such inference or conclusion could be drawn. 8. 2. Therefore, it is not a question of reappreciation of the evidence but it is only a question of determination as to whether the conclusion has been arrived at on the basis of sufficient material or whether such conclusion could be arrived at on the basis of materials available on record. Admittedly such conclusion has been arrived at without any materials simply on the basis of suspicion arising out of the discrepancy in the registration number of the trucks without considering the other materials available on record from which through a cross reference it can be found out and established that there was no removal of goods at all. At the same time on record there is a document at page 152 of the paper book in which the purchaser Larsen and Tubro, for whom the goods were manufactured by the assessee and supplied and which was responsible for the transport of the goods, explained the situation that they used to give the registration number of the trucks to which the delivery was to be made, but sometimes a different truck was placed by the transporter through whom Larsen and Turbo, the purchaser, used to arrange transportation from the factory of the assessee to the delivery point. This clearly explains the discrepancy. In case the Assessing officer was not satisfied with this document in that event it was open to him to enquire about the same and investigate the matter and find out the truth. This seems to have been completely ignored and overlooked. Omission to consider and oversight of a document which has a material bearing on the question leads to perversity in the finding. This seems to have been completely ignored and overlooked. Omission to consider and oversight of a document which has a material bearing on the question leads to perversity in the finding. In a situation available in this case perversity would add to the characteristic of the question of law involved being substantive. 8. 3. This view finds support from the decision in Union of India v. Tarachand Gupta and Bros. , in AIR 1971 SC 1558 . Relying on the decision in Anisminic Ltd. v. Foreign Compensation Commission, (1969) 1 All ER 208: 2 WLR 163, the Apex Court in paragraph 21 of the decision in Tarachand gupta and Bros, (supra) quoted from the observation of Lord Reid at page 213-214 of Anisminic Ltd. which we may beneficially quote herein: "it has sometimes been said that it is only where a tribunal acts without jurisdiction that its decision is a nullity. But in such cases the word "jurisdiction" has been used in a very wide sense, and I have come to the conclusion that it is better not to use the term except in the narrow and original sense of the tribunal being entitled to enter on the enquiry in question. But there are many cases where, although the Tribunal had jurisdiction to enter on the enquiry, it has done or failed to do something in the course of the enquiry which is of such a nature that its decision is a nullity. It may have given its decision in bad faith. It may have made a decision which it had no power to make. It may have failed in the course of the enquiry to comply with the requirements of natural justice. It may in perfect good faith have misconstrued the provisions giving it power to act so that it failed to deal with the question remitted to it and decided some question which was not remitted to it. It may have refused to take into account something which it was required to take into account. Or it may have based its decision on some matter which, under the provisions setting it up, it had no right to take into account. I do not intent! this list to be exhaustive. It may have refused to take into account something which it was required to take into account. Or it may have based its decision on some matter which, under the provisions setting it up, it had no right to take into account. I do not intent! this list to be exhaustive. But if it decides a question remitted to it for decision without committing any of these errors it is as much entitled to decide that question wrongly as it is to decide it rightly. "8. 4. To the same effect are also the observations of Lord Pearce at page 233 in R. v. Fulham, Hammersit and Kensington Rent Tribunal (1953)2 all ER 4, which is yet another decision of a tribunal properly embarking on an enquiry, that is, within its jurisdiction, but at the end of its making an order in excess of its jurisdiction which was held to be a nullity though it was an order of tile kind which it was entitled to make in a proper case. 8. 5. In the circumstances we do not think that we need to deal with all the other elaborate submissions made by Mr. Dutta and the citation which he had cited at the bar. 8. 6. Thus we find that the order of the learned Tribunal and that of the Commissioner of Appeals and the Assessing Officer are perverse and cannot be sustained as discussed above and is liable to be set aside. Conclusion: ( 9 ) FROM the above discussions it appears that the authority is supposed to consider all the documents and come to a clear and definite finding, before it could impose penalty on account of avoidance of excise duty. It cannot proceed on the basis of suspicion, surmise or conjecture. It cannot presume facts. It cannot overlook other documents or materials available. It is the duty of the respective authority to look into all the materials before imposing penalty, the imposition of penalty being penal in nature having civil consequences. It can be imposed only when the authority comes to a clear finding and not otherwise. 9. 1. In the present case as we have discussed viz. , that the other documents, which were available on record and with a cross-reference whereof the issue could easily be decided. It can be imposed only when the authority comes to a clear finding and not otherwise. 9. 1. In the present case as we have discussed viz. , that the other documents, which were available on record and with a cross-reference whereof the issue could easily be decided. It was the bounden duty on the learned Tribunal to look into those documents and enquire and investigate into it in order to ascertain as to whether there was avoidance of excise duty in reality: and only upon such a conclusive finding the penalty could be imposed. Order: ( 10 ) IN the result the appeal succeeds. The order appealed against is hereby set aside. 1. We answer the question No. 1 in the affirmative in favour of the assessee; the question No. 2 in the negative in favour of the assessee and the question No. 3 in the negative in favour of the assessee. 2. The matter is remitted to the learned Tribunal for deciding the question No. 1 afresh in the light of the observation made above on the basis of the materials already available on record after giving an opportunity to the assessee to prove its case by submitting a table of cross-refeferences of the documents and by producing further evidence including examing the records of the transporter and also on additional evidence, if any, produced by the assessee or as it may be advised. Such decision is to be taken within a period of three months from the date of communication of this order in the light of the observations made in this order. The appeal is, thus, allowed. There will be no order as to costs.