Quashing of prosecution not maintainable while the underlying excise demand remains under challenge in pending statutory appeals.

Where the validity of the underlying excise demand was already under challenge in pending statutory appeals before the appellate tribunal, the High Court held that a separate petition to quash the consequential prosecution was not maintainable. The prosecution related to alleged irregular availment of CENVAT credit under the Central Excise Act, 1944, and interim protection had already been granted in the appellate proceedings. In these circumstances, the basis of the criminal proceedings remained subject to adjudication in the statutory forum, so the quashing petition was dismissed.

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Issues: Whether the criminal petition seeking quashing of the prosecution was maintainable when statutory appeals against the assessment order were already pending before the appellate tribunal.

Analysis: The petitioners were facing prosecution under the Central Excise Act, 1944 in relation to alleged irregular availment of CENVAT credit. The liability arising from the order dated 22.05.2008 was already the subject matter of statutory appeals before the appellate tribunal, and interim protection had also been granted in those proceedings. In these circumstances, the challenge to the very basis of the criminal proceedings was still under consideration in the statutory appellate forum, and the High Court found no basis to entertain the quashing petition independently.

Conclusion: The criminal petition was not maintainable and was dismissed.

Ratio Decidendi: When the validity of the underlying excise demand is already under adjudication in pending statutory appeals, a petition to quash the consequential criminal proceedings is not maintainable.

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