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2016 (2) TMI 652 - CESTAT NEW DELHI

2016 (2) TMI 652 - CESTAT NEW DELHI - TMI - Export of antique items - old metallic coins - silver kamar band - confiscation and penalty - relied upon documents are not provided to the appellant - appellant stated that his cross-examination is absolutely crucial because he needs to be questioned on several aspects including (i) whether he was duly authorised by D.G., ASI as required under Section 24 of AAT Act, (ii) the methodology which was adopted by him for coming to a finding that the impugne .....

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hat denial of cross-examination of Mr. Manjhi is grossly violative of principles of natural justice and consequently the impugned order cannot be sustained and would need to be remanded for de novo adjudication, we refrain from expressing any view with regard to the liability of confiscation of the impugned goods seized at Pamposh Enclave. - Matter remanded back - Decided partly in favor of appellant. - Application No. C/MISC/51247/2009-CU[DB] In Appeal No.C/485/2009-CU[DB] - Final Order No.50 .....

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ns, one silver kamar band (waist belt) and 18 copper stamps/ seals declared to be antiquities under Section 24 of the Antiquities and Art Treasures Act, 1972 (hereinafter referred to as AAT Act ), under Section 113 (d) and 113(i) of the Customs Act, 1962. Six cons which are declared to be non-antiquities under Section 24 of the AAT Act were not liable to confiscation. (ii) Absolute confiscation of 33,389 coins declared to be antiquities under Section 24 of the AAT Act under Section 113(d) of the .....

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t, 1962 on Dr. V.J.A. Flynn. (However penalty was not imposed on Mr. Sadasiwan Mudaliar and Mr. SS Rastogi as they had died). 2. The facts of the case, briefly stated are as under:- On 21.06.1994 Dr. V.J.A. Flynn, the appellant, was intercepted at the Indira Gandhi International airport when he was bound for Hong Kong by Air India flight No. AI3126. Examination of his baggage resulted in the recovery of the goods mentioned at serial No.(i) of the order mentioned above which he had not declared a .....

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which belonged to the appellant and which he planned to take out in the month of September, 1994 as per the evidence collected and as these were also held to be antiques under the AAT Act on the basis of the opinion of Director ASI, these were also confiscated under section 113 (d) of the Customs Act, 1962. 3. The Ld. advocate for the appellant essentially pleaded/contended that (i) the documents relied upon by the adjudicating authority were not provided to the appellant. (ii) The adjudicating .....

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memo at the airport and denial of their cross-examination was violative of principles of natural justice. Mr. Manjhi s cross-examination was required for several reasons including that it was not clear as to whether the coins which Mr. Manjhi examined were the same as the ones which were seized and whether Mr. Manjhi was authorised by Director General Archaeological Survey of India as required under Section 24 of AAT Act. There was no evidence given that Mr. Manjhi was authorised by the Director .....

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s fatally. (v) There was no basis to confiscate 34,149 coins seized from Pamposh Enclave, New Delhi as possession of antiques is not an offence and those were not liable to confiscation under Section 113(d) of the Customs Act, 1962 either as it cannot be said that the said coins were attempted to be exported or brought within the limit of any customs area for the purpose of being exported. Ld. advocate for the appellant cited a few judgements in support of his contention including CCE, Nagpur Vs .....

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cuments to the appellant. In the light of the above order, the ld. advocate took us through the documents filed in the appeal as well as the impugned order to show that documents requested for by the appellant had been provided, inter alia, vide letters dated 12.02.2009 and 12.03.2009 in response to the appellant s various requests for documents and that no ground has been taken by the appellant in the appeal disputing the finding the adjudicating authority that all documents which had been requ .....

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es and as a result, waived his right to cross-examine anyone else. He further submitted that the report filed by Mr. Manjhi was quite detailed and provided reasons for the findings given therein. Further, in the light of Section 24 of AAT Act, Mr. Manjhi s report was final and therefore cross-examination will not serve any purpose. He also argued that in all cases cross-examination of a witness may not be necessary and relied on the decision of the Supreme Court in the cases of Kanungo & Co. .....

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mposh Enclave, New Delhi. He submitted that the appellants act of collecting/buying coins from various parts of India and sorting them out at Pamposh Enclave for taking them out of India in a phased manner amounted to attempt to export under the Customs Act, 1962 and cited the case of State of Maharashtra Vs. Mohd. Yakub and Others [1980 (3) SCC 57]. He referred to the appellants and Mr. Rastogi s statements under Section 108 of the Customs Act, 1962 to demonstrate as to how he (i.e. the appel .....

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dvocate for the appellant that the relied upon documents are not provided to the appellant, we find from the perusal of the records that the documents requested by the appellant were indeed provided vide letters dated 20.02.2009 and 12.03.2009 in response to the appellants request. Further, this ground has not been taken by the appellant in its appeal. Thus, we do not find this contention sustainable. 6. Coming to the crucial aspect of the need for cross-examination of Mr. Hari Manjhi, ld. advo .....

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sly argued that Mr. Manjhi is an expert in the field and has given a detailed report running into dozens of pages clearly indicating as to how and why the impugned coins were held to be antiques. An expert gives the report on the basis of his expertise and in the absence of any indication of the mala fide, his cross-examination is not necessary for the fulfilment of the requirement of principles of natural Justice. As Mr. Manjhi s report is final as per Section 24 of AAT Act, his cross-examinati .....

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ld. advocate for Revenue also extensively relied upon the judgement of Supreme Court in the case of Dharampal Satyapal Ltd. Vs. CCE (supra) in support of his opposition to permit cross-examination of Mr. Manjhi and others. In that judgement Hon'ble Supreme Court essentially held that (i) there may be situations where it is felt that fair hearing would make no difference-meaning that a hearing would not change the ultimate conclusion reached by the decision-maker in such situations, fair pro .....

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the order passed is always null and void. (iii) The validity of the order has to be decided on the touchstone of prejudice. The Hon'ble Supreme Court in par 40 of the said judgement observed as under:- 40. In this behalf, we need to notice one other exception which has been carved out to the aforesaid principle by the Courts. Even if it is found by the Court that there is a violation of principles of natural justice, the Courts have held that it may not be necessary to strike down the actio .....

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e test of prejudice or the test of fair hearing. Ld. advocate for Revenue stressed that this judgement supports his contention that in the given circumstances and having regarding to the fact that as per Section 24 of the AAT Act, the opinion of Shri Manjhi is final and his cross-examination would not derogate from the finality of his opinion not permitting his cross-examination has not caused prejudice to the appellant and therefore it is not fatal to the proceedings. Ld. advocate for the appel .....

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more than 8%, the appellant had sought cross-examination of the Technical Experts. Similarly another corroborative evidence used by the Department is the documents recovered from premises of M/s. Monu Steel, a Proprietorship Concern of Sh. S.K. Pansari and in this regard the cross-examination for S.K. Pansari had been requested. But we find that same has been refused by the Adjudicating Authority without giving any valid reasons. It is well settled law that when duty demand against an assessee i .....

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hanchand Chellaram v. CIT, reported in 1980 (Supp.) SCC-660, the cross-examination of Sh. S.K. Pansari from whose premises these documents had been recovered was necessary, more so when the same had been requested and as such the denial of his cross-examination has resulted for denial of natural justice. The judgment of the Apex Court in case of Kanungo & Co. (supra), relied upon by the Department and wherein it was held that natural justice is not violated if cross-examination of the person .....

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amine the witnesses whose statements have been relied upon by the Department and thereafter must permit their cross-examination by the Appellant, if requested by them. The appeal and the stay application stand disposed of as above. We have given this point considerable thought. There is no doubt that there can be a situation where absence of cross-examination of an expert may not cause any prejudice to the litigant and in such a case not allowing cross-examination would not be fatal to the proce .....

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was authorised by D.G., ASI to conduct the examination of the impugned goods in terms of Section 24 of AAT Act because in the absence of such an authorisation the vitality of the report will be lost. Indeed, ld. advocate for the appellant mentioned several aspects on which Mr. Manjhi is required to be cross-examined. Thus, the contention of Revenue that absence of cross-examination of Mr. Manjhi has not caused any prejudice to the appellant cannot be sustained. The observation of the Supreme Cou .....

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en suggest that the order will not be vitiated by denial of cross-examination even when such denial causes prejudice to the person seeking cross-examination. We, thus hold that not permitting cross-examination of Mr. Manjhi is grossly violative of the principles of natural justice and therefore the impugned order is not sustainable. However, we may add here that violation of principles of natural justice is a curable defect [as was argued by ld. advocate for Revenue citing the Delhi High Court j .....

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the cause of justice. Also, in the absence of the cross-examination of the panchas, the appellant is not prejudiced in any way. Accordingly, we are of the view that the appellant has not made out a case for cross-examination of the panchas and this view is supported by Supreme Court judgement in the case of Dharampal Satyapal Ltd. Vs. CCE (supra). Cross-examination of Mr. Dharamvir Sharma is not warranted because nothing is predicated upon his opinion in the impugned order. Thus, no prejudice wo .....

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r the appellant that the adjudicating authority relied upon documents which are not part of the Show Cause Notice, particularly the report of Mr. Manjhi, we find that Delhi High Court in the case of the appellant himself vide order reported at 2003 (159) ELT 92 (Delhi) held that the Show Cause Notice issued on the basis of the opinion of Mr. Dharamvir Sharma was valid and that the report of the Director, ASI under Section 24 of AAT Act certifying whether impugned goods are antique or not is not .....

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ereafter. The additional documents sought by the appellant (which included Mr. Manjhi s report) were duly supplied and after obtaining the reply of the appellant the case was adjudicated. Therefore the appellant s contention that such additional documents were not part of the Show Cause Notice and hence the proceedings were vitiated is not sustainable as the impugned order was issued as per the order dated 10.04.2008 of the Delhi High Court after supplying the additional documents and receiving .....

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