TMI Blog2010 (4) TMI 377X X X X Extracts X X X X X X X X Extracts X X X X ..... Justice R.M.S. Khandeparkar, President and Shri Rakesh Kumar, Member (T) Shri B.L. Narasimhan, Advocate, for the Appellant. Shri Nitin Anand, SDR, for the Respondent. [Order per : Justice R.M.S. Khandeparkar, President]. - Heard. We have also perused the written submissions filed by both the parties. 2. These appeals involve common questions of law and facts and, therefore, were heard together, along with stay applications therein in terms of order passed by the Tribunal on 4-9-2009, and are being disposed of by this common order. 3. The appeals arise from order dated 30-1-2009 passed by the Commissioner, Central Excise, Delhi-I confirming the demand of Rs. 1,48,60,803/- along with interest thereon and penalty of equal amount besides penalty of Rs. 50 lakhs against the Director, while appropriating sum of Rs. 28 lakhs voluntarily deposited vide TR-6 challan in the course of investigation. The appellants are engaged in manufacture and trading of excisable goods i.e. Slotted Angles, Shelves, Cable Trays and other Sheet Fabricated goods classifiable under Chapter heading 7216, 7308 and 9403 respectively of the first Schedule to the Central Excise Tariff Act, 1985. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... opon the said statements. By relying upon those statements, there has been clear violation of principles of natural justice and the impugned order based on those statements is in total defiance of the settled law. 8. The charge of clandestine removal requires strict proof and the onus in that regard was not discharged by the department and, therefore, according to the appellants the impugned order is based on assumptions and presumptions without any concrete proof or tangible and corroborative evidence in support of the allegations. 9. According to the appellants the fact that the suppliers had actually sold the traded goods is evident from the fact that the suppliers were registered with Sales Tax/VAT department as the manufacturers and traders of steel items and had paid sales tax on their sales. Further, the very similar supplier have also made sales to other independent third parties of the very goods is also evident from the record. Several suppliers had shown the appellants as sundry debtors in their books of account and some suppliers are also reflected as sundry creditors in appellants' books of accounts and, therefore, the statements of the suppliers contrary to those ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appellants. The investigation conducted in the matter revealed that some of the parties who were claimed to be the suppliers were never in existence. Some of the parties were dealing in manufacture and trading of unrelated items such as Tawa, Balti, Hawan kund, Wooden Furniture, Chit Fund business, Automobile parts Light poles, etc. Some of those parties had no infrastructure to manufacture items like slotted angles/shelves, cable tray, etc. No record such as the invoices of raw material, register of finished goods, register and other related records pertaining to the manufacture/trading were disclosed to have been maintained by those parties. Some of those units had residential addresses. Some of the parties name as supplier were supplying only iron sheets whereas description of the items supplied were changed as per party's request. 14. It is further case of the department that the investigation about SSP Manufacturing Trading Corpn., a manufacturing unit revealed that it operated from B-66, Naraina Industrial Area which were the premises owned by Shri Subhash Khattar and that trading godown of the party was also located in the same premises. Shri Subhash Khattar admitted i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ike Tawa, Balti, etc. Investigation has also revealed that the some of the firms claimed to be supplier to the appellants were not even in existence at all. 18. While contending that the evidence in adjudication proceedings need not to be like the one in criminal cases and the findings should be on the basis of preponderance of probability, attention is sought to be drawn to the decision in the case of Rup Chand Jain v. Collector of Customs (Preventive), Calcutta, reported in 1996 (88) E.L.T. 335 (Cal.) and Santhanam v. Collector of C. Excise Customs, Madurai-2, reported in 1995 (79) E.L.T. 564 (Mad.). It is further submitted on behalf of the respondent that since no record regarding transaction was maintained by the appellants, the department was constrained to rely upon other evidence including the statements. 19. It is apparent that the appellants are challenging the impugned order essentially on the ground that the same is based on the statements of witnesses which have not been subjected of being tested by way of cross-examination of the deponent. In other words, it is a case of the appellants that the deponent's statement cannot be relied upon unless the deponent is cro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s Ltd. v. Collector of Central Excise, reported in 2009 (242) E.L.T. 189 (Del.) had occasion to deal in detail with the issue relating right to cross-examine of the deponent by the assessee. Relying upon the decision of the Apex Court in CCE v. Duncan Agro Industries, reported in 2000 (120) E.L.T. 280 (S.C.) wherein it was held that "We hold that a statement recorded by Customs Officers under Section 108 of the Customs Act is admissible in evidence. The court has to test whether the inculpating portions were made voluntarily or whether it is vitiated on account of any of the premises envisaged in Section 24 of the Evidence Act held that" though it cannot be denied that the right of cross-examination in any quasi-judicial proceeding is valuable right given to the accused/noticee, as these proceedings may have adverse consequences to the accused, at the same time under certain circumstances, this right of cross-examination can be taken away." Having held so, the Hon'ble High Court analysed the Section 9D as under :- "Section 9D of the Act stipulates following five circumstances, already taken note of, under which statements previously recorded can be made relevant. These are:- (a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oted para 76 of Halsbury's Law of England, Vol. I (4th Edition) which reads thus :- "Natural justice does not impose on administrative and domestic tribunals a duty to observe all the technical rules of evidence applicable to proceedings before courts of law. Members of tribunals may be entitled to draw on their specialized or local knowledge of the type of, issue before them in order to supplement as well as evaluate evidence to find facts by inquisitorial methods, and inspections and to obtain information from other persons; but it will generally be a denial of justice to fail to disclose to a party specific material relevant to the decision if he is thereby deprived of any opportunity of comment on it." The Hon'ble High Court observed thus :- "In other words, it seems to be a fairly settled position in law that it is not necessary that persons whose statements have been previously recorded must be examined in the presence of the party against whom such previous statements are intended to be used. The rules of natural justice do require that their previous statements must be made available to the party against whom they were intended to be used and such party must be given ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he special knowledge of the persons from whom the diamonds were seized, the burden to prove that the diamonds were smuggled which undoubtedly rested with the department was alleviated. 25. The Apex Court in Surjeet Singh Chhabra v. UOI, reported in 1997 (89) E.L.T. 646 (S.C.) while dealing with the similar issue held that when the petitioner seeks for cross-examination of witnesses who have said that the recovery was made from the petitioner, necessarily an opportunity requires to be given for the cross-examination of the witnesses as regards the place at which recovery was made. But in view of confession made by the petitioner the same was binding upon him and, therefore, in such facts and circumstances failure to give him opportunity to cross-examine the witnesses would not violative of principle of natural justice. It was also ruled that the Customs officials are not police officers. The confession though retracted is an admission and binds the petitioner. 26. Relying upon the decision of the Apex Court in Surjeet Singh Chhabra case (supra) this Tribunal in Jagdish Shanker Trivedi v. Commissioner of Customs, Kanpur - 2006 (194) E.L.T. 290 (Tri.-Del.) held that admission made ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat the authority would have passed the order on the basis of the other relevant and existing grounds, and the exclusion of the irrelevant or non-existing grounds could not have affected the ultimate opinion or decision." 28. In fact, the Apex Court in Surjeet Singh Chhabra v. U.O.I., reported in 1997 (89) E.L.T. 646 clearly held that Customs officers are not police officers and admission made before them, though retracted, binds the deponent. 29. Bearing in mind the law laid down in above decisions and applying the same to the facts of the case in hand, it is apparent that the adjudicating authority did issue summons to the witnesses whose statements were recorded and whom the appellants had desired to cross-examine in relation to those statements. However, those witnesses failed to appear before the authorities. As already pointed out above undisputedly this was to the knowledge of the appellants and there was no efforts made on the part of the appellants to insist for cross-examination of those witnesses and/or to insist for their presence for cross-examination. Instead the appellants themselves choose to make a submission to discard the statements of those witnesses and to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by cheques and that after deduction of sales tax and another taxes, the balance amount was returned to the party in cash after withdrawing the money from the bank. Similarly, Shri Harish Dalmia has stated in his statement that they did not have any facility and infrastructure for manufacture of such items and they were issuing bills without actually selling or transporting the material in terms of the bills. Modalities of cheque payment and withdrawal of amount from the bank and return thereof to the party as stated by Shri Mahesh Kaushik has also been confirmed by this witness. Shri Jagmohan Agarwal has admitted in his statement that he was not carrying any manufacturing activity in respect of items in question and he was in the business of selling iron sheets to the party and descriptions in the invoices were incorrectly stated at the request of the party. Shri Vijender Singh has also admitted that he had issued bills without supply and manufacture of the items mentioned in the bills and for that purpose he was getting fixed commission from the party. 32. Undisputedly the statements of supplier disclose sufficient evidence in support of the case put forth by the respondent agai ..... X X X X Extracts X X X X X X X X Extracts X X X X
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