Territorial jurisdiction and parallel excise proceedings: criminal investigation for cheating and conspiracy was allowed to continue.

Territorial jurisdiction was not available to the Calcutta High Court to entertain a Section 482 CrPC petition seeking quashing of an investigation and FIR linked to a matter pending at Balasore, because the alleged acts occurred at the factory site and the processing of CBI papers in Calcutta or the company's head office there did not confer jurisdiction. The FIR alleging evasion of central excise duty, conspiracy and cheating was also not quashed merely because excise proceedings were pending, since recovery and penalty under excise law do not displace criminal investigation where the FIR independently discloses prima facie offences; the investigation was permitted to continue.

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Issues: (i) Whether the High Court had territorial jurisdiction to entertain the application for quashing of the investigation and F.I.R.; (ii) Whether the F.I.R. alleging evasion of central excise duty, conspiracy and cheating was liable to be quashed merely because parallel proceedings under the excise law were pending.

Issue (i): Whether the High Court had territorial jurisdiction to entertain the application for quashing of the investigation and F.I.R.

Analysis: The application under Section 482 of the Code of Criminal Procedure sought quashing of proceedings connected with a case pending at Balasore. The alleged evasion, if any, was said to have occurred at the factory where the goods were manufactured and removed. The Court held that the place of processing of the C.B.I. papers at Calcutta or the location of the company's head office there did not confer territorial jurisdiction for calling for records from a court outside its territorial limits. In the circumstances, the matter was treated as one not fit for exercise of inherent jurisdiction by that Court.

Conclusion: The objection to territorial jurisdiction was upheld and the application was not entertained by the High Court.

Issue (ii): Whether the F.I.R. alleging evasion of central excise duty, conspiracy and cheating was liable to be quashed merely because parallel proceedings under the excise law were pending.

Analysis: The Court noted that proceedings under the Central Excises and Salt Act addressed recovery, penalty and confiscation, but they did not substitute the criminal process where the F.I.R. disclosed allegations of cheating, conspiracy and involvement of a public servant. The existence of pending excise proceedings, by itself, did not bar the criminal investigation. The allegations disclosed prima facie offences and the case did not fall within the limited category warranting interference at the stage of investigation.

Conclusion: The F.I.R. was not liable to be quashed and the criminal investigation was allowed to continue.

Final Conclusion: The revisional application failed in both respects and the criminal proceedings were permitted to proceed notwithstanding the pending excise action.

Ratio Decidendi: Pending adjudication or recovery proceedings under excise law do not bar criminal investigation where the F.I.R. independently discloses prima facie offences such as cheating and conspiracy, and inherent jurisdiction should not be exercised to quash such proceedings absent exceptional grounds.

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