TMI Blog2017 (11) TMI 440X X X X Extracts X X X X X X X X Extracts X X X X ..... maining three witnesses whom the petitioner wanted to summon for cross-examination are concerned, the Adjudicating Authority has recorded categorically that their statements were supported by records maintained by their firms/companies and that the details of such records were also indicated in Annexures C-16, C-18 and C-21 to the show cause notice - the factual grounds on which the Adjudicating Authority rejected the request for cross-examination, are cogent and convincing. The statements of third party witnesses were in fact shown to one of the Directors of the petitioner/Company by name Babulal Doshi and he is stated to have confirmed those statements. In Surjeet Singh Chhabra v. Union of India [1996 (10) TMI 106 - SUPREME COURT OF INDIA], the Supreme Court was concerned with a case arising under the Foreign Exchange Regulation Act and the Customs Act. Though the decision in Surjeet Singh Chhabra was a very brief order, the Supreme Court rejected the contention that the denial of cross-examination tantamounted to the violation of the principles of natural justice. The right to cross-examine is not absolute at least insofar as the cases of this nature are concerned. If ther ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... why CENVAT Credit amounting to ₹ 4,50,52,629/-, for the period from 01-02-2007 to 02-10-2011 should not be demanded and recovered under Section 11A(1). This show cause notice resulted in an ex parte Order-in-Original being passed on 20-5-2013. 5. As against the Order-in-Original dated 20-5-2013, the petitioner filed an appeal before the CESTAT. The CESTAT allowed the appeal by an order dated 08-9-2014 and remanded the matter back to the Adjudicating Authority. 6. In the de novo proceedings, held on 20-10-2015, the authorised representative of the petitioner seems to have requested for cross-examination of some persons. The petitioner also requested permission to inspect the documents. 7. But the request was rejected and hence the petitioner filed a reply to the show cause notice. Thereafter, a personal hearing took place on 18-3-2016. It appears that the petitioner reiterated their demand for cross-examination. However, by the order impugned in the writ petition dated 31-3-2016, which was later modified by a corrigendum dated 24-8-2016, the 3rd respondent confirmed the demand. Therefore, aggrieved by the same, the petitioner has come up with the above writ petition. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts that documents from C1 to C8, C13, C15 to C18, C20, C22, C24 to C28 and C1.4 are not available in the relied upon documents. This submission has been simply brushed aside without proper discussion and without taking note of the fact which was brought out by the learned AR today during the hearing that till then correspondence was being undertaken by the appellants and they had been provided documents on two occasions and this specific complaint about specific documents not being received had not been made till that date. 11. In paragraph-6 also, the discussion revolved only around the non-furnishing of the documents. In paragraph-7 of its order (penultimate paragraph), the Tribunal recorded its findings and in paragraph-8, the Tribunal recorded the result of the appeals. Paragraphs-7 and 8 of the order of the Tribunal read as follows: 7. From the above it can be seen that it was the Commissioners office who directed the assessee to go to DGCEI office and also required the Additional Director to conduct verification and send a confirmation. That being the position, it was not proper for the Commissioner to simply adjudicate the matter ignoring his own office request to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onceived. Unless the Tribunal has recorded a categorical finding that the refusal of the Adjudicating Authority to permit cross-examination was illegal or unless the Tribunal has directed the Adjudicating Authority to allow cross-examination, it is not open to the petitioner to contend that the order of the Tribunal was not complied with. 13. In any case if the petitioner thinks that the Adjudicating Authority failed to comply with the order of the CESTAT, they should have gone again before the CESTAT. After all, the order impugned in the writ petition is liable to be appealed against, to the very same CESTAT. Without going to the Tribunal and complaining that its order of remand was violated, the petitioner has chosen to come to this Court to complain that the order of the CESTAT was violated. Therefore, we have no hesitation in rejecting the second contention. 14. The first contention revolves around the refusal of the adjudicating authority to permit cross-examination. In order to understand and appreciate the scope and reach of this contention, it is necessary to look into the nature of the allegations against the petitioner, which lead to the adjudication. The allegation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... petitioner. 3. N.M. Bhandari AGM (Accounts) of M/s. Stainless India Ltd. He claimed that his company did not receive any S.S. Coils from the petitioner and that S.S. Coils could not be used in their induction furnace for melting purposes. The petitioner claims that being an accounts person, this person was not competent to speak about the aspects of production. At the same time, the petitioner claim that Sri Bhandari was correct in stating that M.S. Patti was not received. But the petitioner claims that Bhandari failed to disclose that what was received by the company was M.S. Patti Scrap ignited in the factory and not supplied by Akshat Traders. Therefore, the petitioner wanted to cross-examine him to cull out the actual nature of material that was sent for conversion. 4. Ashok Fulvalia Director, M/s. Harrison Steels Pvt. Ltd. This witness stated that M.S. Patti was not received but M.S. Scrap was received. The petitioner wanted this witness to come with all the factory records showing the receipt of M.S. Patti from their factory. 16. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rounds on which the Adjudicating Authority denied permission for cross- examination, it was contended by Mr. Madhava Sham Murthy, learned counsel for the petitioner, that in Telestar, the Supreme Court was dealing with proceedings under the Foreign Exchange Regulation Act, 1973. Since Rule 3 of the Adjudication Rules made it clear that the rules of procedure do not apply to adjudication proceedings, the Supreme Court came to a particular conclusion in Telestar and hence, according to the learned counsel for the petitioner, the said decision cannot be relied upon in the proceedings under the Central Excise Act. In support of this contention, the learned counsel places heavy reliance upon the decision of a Division Bench of the Bombay High Court in Nirmal Seeds Pvt. Ltd. v. Union of India 2017 (350) E.L.T. 486 (Bom.). 19. We have carefully considered the reasons stated in paragraph-22.1 of the impugned order and the contentions of the learned counsel for the petitioner. We have already tabulated the details of the persons whom the petitioner wanted to cross-examine and the reasons for the petitioner making such a request. The first witness whom the petitioner wanted to cross-exami ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... statements of the third party witnesses, failed even to appear before the Adjudicating Authority despite the fact that the Company as well as the other Director were represented before the Adjudicating Authority. Therefore, the reasons stated by the Adjudicating Authority cannot be found fault with. 24. Coming to the legal grounds, it is seen that in Kanugo Co. v. Collector of Customs 1983 (13) E.L.T. 1486 (S.C.), the Supreme Court held categorically that the principles of natural justice do not require that in matters of this nature, persons who gave information should be allowed to be cross-examined. In Kanugo Co., what was in challenge was an order of confiscation of goods under Section 167(8) of the Sea Customs Act, 1878 read with Section 3(2) of the Imports and Exports (Control) Act, 1947. In paragraph-12 of its judgment, the Supreme Court held in Kanugo Co. as follows: 12. The complaint of the appellant now is that all the persons from whom enquiries were alleged to have been made by the authorities should have been produced to enable it to cross-examine them. In our opinion, the principles of natural justice do not require that in matters like this the persons ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and the documents seized in the course of the search of their premises. But, there is no dispute that apart from what was seized from the business premises of the appellants the Adjudicating Authority also placed reliance upon documents produced bys Miss Anita Chotrani and Mr. Raut. These documents were, it is admitted disclosed to the appellants who were permitted to inspect the same. The production of the documents duly confronted to the appellants was in the nature of production in terms of Section 139 of the Evidence Act, where the witness producing the documents is not subjected to cross-examination. Such being the case, the refusal of the Adjudicating Authority to permit cross- examination of the witnesses producing the documents cannot even on the principles of Evidence Act be found fault with. At any rate, the disclosure of the documents to the appellants and the opportunity given to them to rebut and explain the same was a substantial compliance with the principles of natural justice. That being so, there was and could be no prejudice to the appellants nor was any demonstrated by the appellants before us or before the Courts below. The third limb of the case of the appell ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
