JUDGMENT : K.M. Thaker, J. Heard Mr. N.D. Nanavati, learned Senior Counsel, with Mr. Rachh, learned advocate for the petitioner, Ms. Mandavia, learned advocate for the respondent No.1, and Ms. Chandarana, learned A.P.P. for the respondent No.2 – State. 2. In this petition, the petitioner has prayed, inter alia, that: "8(A) Your Lordships be pleased to call for the record and proceedings of Criminal Case No.138 of 2006 from the Court of Ld. Additional Chief Metropolitan Magistrate, Ahmedabad and after perusing the same be pleased to quash the impugned complaint and proceedings pursuant thereto, qua the present petitioner, in the interest of justice;" 3. This petition has been admitted vide order dated 9.5.2013, relevant part of the said order reads thus: "1. . 2. Having regard to the submissions advanced by the learned counsel for the petitioner, Issue Rule returnable on 19th June, 2013. By way of ad-interim relief, further proceedings of Criminal Case No.138 of 2006 pending in the court of the learned Additional Chief Metropolitan Magistrate, Ahmedabad, are hereby stayed qua the present petitioner only. Ms. Archana Raval, learned Additional Public Prosecutor waives service of notice of rule on behalf of the respondent No.2 State of Gujarat." 4. The short ground on which the petitioner has preferred present petition and assailed the proceedings of Criminal Case No.138 of 2006 is that the proceedings against present petitioner on civil side have been decided in favour of the petitioner and the said decision has attained finality and that therefore, the criminal case instituted against the petitioner may be quashed. 5. So as to support and justify the request made in present petition, the petitioner has mentioned certain facts, which read thus: "3.1. The petitioner respectfully submits that accused no.1 company namely, Ashok Fashions Limited was incorporated under the provisions of the Companies act, 1956 and is engaged in the business of processing of cotton fabrics and manmade fabrics. The said company was promoted by Ashok Agarwal (accused no.3), Sushil Agarwal, Manoj Agarwal and Suresh Agarwal who are the brothers of the petitioner and the petitioner is the eldest of them. 3.2. The petitioner has never participated in the affairs of the said company. It is pertinent to note at this stage that petitioner has already resigned from the post of directorship of the company on 25.03.1999 and Form No.32 to that effect is also submitted under the Companies Act. 3.3. 3.2. The petitioner has never participated in the affairs of the said company. It is pertinent to note at this stage that petitioner has already resigned from the post of directorship of the company on 25.03.1999 and Form No.32 to that effect is also submitted under the Companies Act. 3.3. The petitioner respectfully submits that central excise authority initiated proceedings under the act by issuing a show cause notice dated 30.03.2000 to the accused company, petitioner and other directors alleging evasion of central excise duty by the accused company on the ground that company is involved in clandestine manufacturing, storing, removing and selling of the excisable goods which were liable for confiscation under the provisions of the Central Excise Act, 1944. It was also alleged that the petitioner actively participated in the evasion of central excise duty and thereby rendered himself along with the others, liable for penal action under the provisions of the Act and rules framed there under. . 3.4. Pursuant thereto, the Commissioner, Central Excise, Ahmedabad, passed an ex parte order dated 30.09.2002 so far as present petitioner is concerned, issuing several directions against the accused company and further imposing a penalty of Rs. 50 lakhs upon the petitioner as a director of the accused-company. 3.5. Being aggrieved, petitioner approached the Appellate Tribunal and vide order dated 27.01.2006, CESTAT was pleased to set aside the ex parte order and remand the matter to the adjudicating authority for fresh decision on merits. 3.6. In the meanwhile, to the shock and surprise of the petitioner, on the self same allegation and charges levelled in the aforesaid show cause notice, impugned criminal complaint dated 31.07.2006 under section 9 and 9AA of the Central Excise Act, 1944 came to be filed by the respondent no.2 authority before the Ld. Additional Chief Metropolitan Magistrate, Ahmedabad. 3.7. Subsequently, after hearing the petitioner, the Commissioner, Central Excise, Ahmedabad, passed an order dated 29.11.2006 imposing penalty of Rs. 50 lacs on the petitioner under the provisions of Act and rules framed therein. 3.8. Being aggrieved, petitioner approached the Appellate Tribunal i.e. CESTAT by preferring an appeal. After going through the evidence and material on record in detail, the Tribunal arrived at a finding that there was no material or evidence on record to show that the clandestine activities were done with the consent, permission or even knowledge of the petitioner. 3.8. Being aggrieved, petitioner approached the Appellate Tribunal i.e. CESTAT by preferring an appeal. After going through the evidence and material on record in detail, the Tribunal arrived at a finding that there was no material or evidence on record to show that the clandestine activities were done with the consent, permission or even knowledge of the petitioner. The Tribunal further held that there is no evidence of personal knowledge or belief on the part of the petitioner. 3.9 . 3.10 . 3.11 The petitioner respectfully submits that the above facts are stated before this Hon'ble Court only with a view to pointing out that the impugned complaint is filed with an oblique and ulterior motive to harass the petitioner using police machinery as level as there was nothing on the record to even remotely suggest that the petitioner committed any wrong as alleged in the impugned complaint." 6. In background of the above mentioned facts, it is contended by learned Senior Counsel for the petitioner that the Appellate Authority under the provisions of the Central Excise Act, 1944 has, vide order dated 9.7.2007, while deciding the issue related to imposition of penalty in favour of the petitioner held that there is no justification for imposing penalty on the petitioner and that therefore, now, there is no justification to prosecute the petitioner and to continue the proceedings. 6.1. The said decision, which is rendered in proceedings of civil nature under the provisions of the Central Excise Act, 1944 is passed by the learned Appellate Tribunal in Appeal No. E/271/2007 and, undisputedly, it has not been challenged until now and even according to the respondent department, the said order has attained finality, and that therefore, now there is no justification for continuing the criminal proceedings and consequently, the criminal case No.138 of 2006 is required to be quashed. 7. 7. Learned advocate for the respondents has not disputed the factual background and has confirmed that in connection with same transaction and on same facts/allegations a show cause notice was issued and subsequently, criminal case came to be filed and upon hearing the appeal against Commissioner's order, the learned Appellate Tribunal has set aside the order of Commissioner whereby upon adjudication of the show cause notice, penalty was imposed and the appellate authority's decision in favour of the petitioner and the respondent authorities have not carried the said order dated 19.7.2007 in further proceedings, either by way of statutory appeal before the Hon'ble Apex Court or by way of writ petition. Learned counsel for the respondent would, however, submit that the proceedings may not be quashed on the ground that the learned tribunal has decided the issue in favour of the petitioner. 8. I have heard learned Senior Counsel for the petitioner and learned counsel for the respondent authorities and I have also considered the material and documents placed on record. 9. So as to appreciate the controversy and dispute between the parties, it is appropriate and relevant to take into account certain dates/events: Sr. No. Date Particulars (a) 30.3.2000 The Central Excise Authorities issued a show-cause notice and initiated proceedings under the provisions of the Act against the company, present petitioner and other directors alleging evasion of central excise duties. (b) 30.9.2002 In pursuance of the said show cause notice, the Commissioner, Central Excise, passed an ex-parte order and issued several directions, including imposition of penalty to the tune of Rs. 50 lacs on the petitioner as one of the directors of the company. (c) - Against the said ex-parte order, the petitioner preferred appeal before the learned Appellate Tribunal. (d) 27.1.2006 The Learned Tribunal allowed the said appeal and remanded the matter to the adjudicating authority for decision on merits. (e) 31.7.2006 While the said proceedings were pending (after remand), the authorities under the Act filed the impugned criminal complaint under Sections 9 and 9AA of the Act. (f) 29.11.2006 After hearing the petitioner (upon remand of the proceedings by the learned tribunal), the Commissioner, Central Excise, passed order dated 29.11.2006 imposing penalty of Rs. 50 lacs on the petitioner as one of the directors of the company. (g) - Against the said order, the petitioner approached the learned Appellate Tribunal (i.e. CESTAT). (f) 29.11.2006 After hearing the petitioner (upon remand of the proceedings by the learned tribunal), the Commissioner, Central Excise, passed order dated 29.11.2006 imposing penalty of Rs. 50 lacs on the petitioner as one of the directors of the company. (g) - Against the said order, the petitioner approached the learned Appellate Tribunal (i.e. CESTAT). (h) 9.7.2007 The Learned Tribunal, after hearing the petitioner and the department, passed detailed order on merits in favour of the petitioner holding, inter alia, that "in view of our foregoing discussion, we find no justification for imposition of penalty upon the appellant. The same is, accordingly, set aside and appeal allowed with consequential relief. 10. In the order dated 9.7.2007, the learned tribunal has held that: "4. After appreciating the above contention, we find that the adjudicating authority has referred to the statement of one Shri Rajubhai Thakkar, who deposed that the signatures on the loose sheets are of Shri Dayaram Agarwal, Chairman of the company. However, during the course of adjudication, the appellate produced on record, the opinion of handwriting expert. As per the said opinion, authentic signature of the appellant, as appearing in his income tax return, passport, affidavit, etc. was compared with the alleged signature on the loose sheet and it was opined that the same were not his signature. In response to the above plea of the appellant, the adjudicating authority has observed that "It is possible that if the signature is not in the handwriting of Shri Dayaram Agarwal, it could well be at his instance by someone else. In such cases, clandestine removals can not be done without the specific permission or consent of the Chairman/Directors of the company." The above observation made by the adjudicating authority are clearly in the realm of surmises and conjunctures and cannot be equated with any legal evidence on record. No presumption can be drawn as a way of general comment that all clandestine removal involve the permission or consent of the chairman. It is well settled that for invoking provisions of Rule 209A, positive evidence of personal knowledge or belief on part of the director or chairman is required to be brought on record. No presumption can be drawn as a way of general comment that all clandestine removal involve the permission or consent of the chairman. It is well settled that for invoking provisions of Rule 209A, positive evidence of personal knowledge or belief on part of the director or chairman is required to be brought on record. Merely because the appellant was chairman of the company, he cannot be held to be aware of all the activities of the company and as such a claim would no per se suffice to hold him liable to penalty under Rule 209A. For the above proposition, reference is made to Tribunal's order in case of Man Industries (India) Ltd. v. C.C.E. Indore, 2004 (175) ELT 435 (Tri-Del.). Further in the case of E.M.C.E.E. Crowns v. C.C.E. Bangalore, 2004 (113) ELT 490 (Tri.), it was observed that the penalty cannot be imposed upon the chairman and managing director of the appellant company as they cannot be held responsible for day to day clearances effected from the factory, which was situated in far away place in the remote area. In as much as the appellant was admittedly residing at Kolkata and not at the place of location of the factory, it cannot be concluded, in absence of any specific positive evidence that he was involved in day to day working. 5. Reliance can also be made on another decision of the Tribunal in the case of Cipta Coated Steels Ltd. v. C.C.E. Aurangabad, 1999 (113) ELT 490 (Tri) laying down that in absence of evidence to show guilty mind on the part of the assess, onus is upon the Revenue to show such a mensrea. It does not require any further reference to precedent decisions to observe that it is almost settled law that in the absence of any evidence, bringing out any conscious act on the part of the director or chairman, penalty cannot be imposed merely because the assessee happens to be a chairman of the company. Knowledge cannot be simply attributed to a person holding a particular post. 6. In view of our foregoing discussion, we find no justification for imposition of penalty upon the appellant. The same is, accordingly, set aside and appeal allowed with consequential relief." 11. Knowledge cannot be simply attributed to a person holding a particular post. 6. In view of our foregoing discussion, we find no justification for imposition of penalty upon the appellant. The same is, accordingly, set aside and appeal allowed with consequential relief." 11. So far as the petitioner is concerned, it is necessary and relevant to mention that for same transaction and on same facts and on same allegations, the respondent – department initiated two types of proceedings against him viz. (a) one by way of civil (departmental) proceedings against the petitioner by issuing a show cause notice under the provisions of the Act and Rules viz. Rule 9(i), Rule 52A, Rule 173(F), Rule 173G(i), Rule 173(g)(4), Rule 226, Rule 54, Section 11A(I), Rule 209A, Rule 9(2), Section 11AC, Rule 173Q, etc. and (b) other proceedings by way of criminal complaint/criminal case under Section 9 and 9AA of the Act. The said two proceedings came to be instituted on same facts and for same alleged act/transaction and on same allegations. 11.1. Now, so far as the proceedings arising from show cause notice is concerned, it has culminated in order dated 9.7.2007 by learned Appellate Tribunal (C.E.S.T.A.T.) whereby the order imposing penalty (passed by adjudicating authority – Commissioner) is set aside on merits by learned Appellate Tribunal. Consequently, in the proceedings on civil side on same facts and for same transaction and on same allegations, the petitioner is discharged on merits of all liability and it is held that there is no justification for imposition of penalty on the petitioner. 11.2. At this stage, it is pertinent that the impugned criminal proceedings against the petitioner came to be instituted/filed in light of and on the strength of Commissioner's order imposing penalty on the petitioner, which is evident from paragraph No.6 of the impugned criminal complaint. The said paragraph No.6 reads thus: "(6) In view of foregoing facts based on record and statement of various persons a show cause notice was issued by Additional Director General, DGAE, Mumbai Shri R.C.Verma on 30-3-2000 F.No. DGAE/BZU/205/12(4)/20/2000 against M/s. AFL, accused No.2 and No.3 and various traders. After the adjudication proceedings commissioner of Central Excise, Ahmedabad – I Shri K.K. Agarwal vide his Order in Original F. No. V.54/1508/OA/2002 dated 30.9.2004 has passed the following order: (i) . (ii) . (iii) . (iv) . (v) I impose a penalty of Rs. After the adjudication proceedings commissioner of Central Excise, Ahmedabad – I Shri K.K. Agarwal vide his Order in Original F. No. V.54/1508/OA/2002 dated 30.9.2004 has passed the following order: (i) . (ii) . (iii) . (iv) . (v) I impose a penalty of Rs. 50 lakhs on Shri Dayaram Agarwal, Chairman of M/s. A.F.L. and penalty of Rs. 50 lakhs on Shri Ashok Agarwal, Director of M/s. A.F.L. under rule 209A of the Central Excise Rules 1944 (Rule 26 of Central Excise Rules 2002). (vi) ." 11.3. The order imposing penalty has been set aside twice, first on ground that it was passed ex parte and without hearing the petitioner and second time on merits vide learned Tribunal's order dated 9.7.2007. 11.4. Thus, now, when the Commissioner's order imposing penalty on the petitioner is set aside by learned Tribunal, then the very basis of the complaint is lost and is knocked down and it does not survive. The learned Tribunal has held and declared that "there is no justification for imposing penalty" on the petitioner. 11.5. Thus, when the final adjudicating authority has clearly held that any material is not available and the allegations are not established i.e. the department has failed to prove the charges/allegations then it is beyond imagination that in criminal proceedings – where the onus will be to prove the charges and allegations beyond reasonable doubt – the department will be able to prove the charges before the learned trial Court where the standard of proof is stringent. 11.6. It is relevant and pertinent that after the order by learned Appellate Tribunal even the department has not carried the proceedings further i.e. beyond the stage of learned Tribunal's order and said order has attained finality. 12. In this view of the matter, it would be unjust and undue harassment if the criminal proceedings are continued. In such facts, the request to quash the criminal proceedings as prayed for deserves to be and is required to be granted. 12.1. On the same allegations and for same transactions and on same facts, the respondent authority is not justified–And therefore, cannot be permitted – to continue to prosecute the petitioner and to continue to pursue the action when the very basis, i.e. the order imposing penalty, is lost and is knocked down by learned Appellate Tribunal on merits and it does not survive after said order dated 9.7.2007. 13. 13. The view is fortified by the observations by Hon'ble Apex Court in the case between Radheshyam Kejriwal v. State of West Bengal, (2011) 3 SCC 581 . 14. Having regard to the above mentioned aspects and the relevant provisions and the conclusion by the learned tribunal in the decision dated 9.7.2007 where the learned tribunal has set aside the order imposing penalty on present petitioner and has held that there is no justification in imposing penalty on the petitioner and considering the fact that the impugned proceedings are initiated on strength of and are based on the ground that the adjudicating authority held against the petitioner and considering that in light of learned Tribunal's order dated 9.7.2007 the very bases of criminal case is taken away, expired and lost and does not survive, the petition deserves to be allowed and the impugned complaint deserves to be quashed. 14.1. For the foregoing reasons, present petition is allowed in terms of para 8(A). The impugned complaint/criminal case No.138 of 2006 is hereby quashed qua the petitioner herein. Rule is made absolute to the aforesaid extent. No costs. Direct service is permitted. Appeal allowed.