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2021 (9) TMI 1107 - HC - Central ExciseClandestine removal - shortage and excesses of stock - sufficient evidence to establish the clandestine removal or not - excess of the recorded balance in RG1 register - cross-examination of witnesses - Penalty u/r 26 of CER - HELD THAT:- The Apex Court in Andaman Timber Industries Vs. Commissioner of C.EX., Kolkata-II [2015 (10) TMI 442 - SUPREME COURT] held that not allowing a party to cross examine witnesses of the Adjudicating Authority whose statement was the basis of the show cause notice to demand duty is a serious flaw in as much as it amounted to violation of principles of natural justice. It is noted that the Commissioner refused permission to cross examine Thakkar notwithstanding the request made by respondent nos.1 and 2. The permission to cross examine Thakker should have been granted mainly in view of the fact that appellant was relying on the statement of Thakkar and documents which were seized from Thakkar - the majority view is agreed upon that rejection of the request for cross examination of Thakkar would mean that Thakkar's statement cannot be relied upon. The Member (Judicial) has held without discussion that there is also no justification for imposition of penalty of ₹ 40 lakhs on Thakkar. The Member (Technical) has held that the penalty on Thakkar will also depend on the ultimate determination of penalty on respondent nos. 1 and 2. Penalty on Thakkar was not the subject matter of reference to the third member. Thus, question no.4 also in the affirmative. Questions are answered in the affirmative - Appeal dismissed.
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