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TMI Blog2017 (11) TMI 2011X X X X Extracts X X X X X X X X Extracts X X X X ..... dustrial use. 3. Investigation was carried out at various premises including that of the petitioner by the department on the basis that there had been diversion of AGU for industrial use. This culminated into issuance of show cause notices including against the petitioner. Against the petitioner, the show cause notice is dated 25.5.2015. In a rather detailed notice the authority confronted the petitioner with voluminous material to establish such clandestine diversion of AGU. Under the notice, the petitioner was called upon to show cause why various penalties prescribed under the Customs Act, 1962 should not be imposed on them. In the show cause notice, reference was made to several statements of the co-noticees and other individuals recorded by the authority on which reliance was sought to be placed for proving the charge against the petitioner. The petitioner replied to such show cause notice under a communication. The reply carried a caption of the subject "Preliminary reply, including Preliminary Objections, to the maintainability of the above SCN, & Request for Cross Examination of Various Persons, by Mr.Mulchandani". In the reply, the petitioner had taken various defences. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y were allowed to peruse. This record was anyway available to the petitioners. The authority was also of the opinion that the petitioner having made confessions, there was no need to permit crossexamination of the other witnesses. Having thus dealt with the petitioner's request for cross-examination of various witnesses, the adjudicating authority proceeded to decide the issues on merits. He relied upon the confessional statements of the petitioner and statements of other co-noticees and also other material collected during the course of investigation, which included statements of various persons such as dealers of agricultural products, transporters etc. 6. Learned advocate Shri Dave appearing for the petitioners submitted that the adjudicating authority has committed a serious error in not permitting cross-examination of vital witnesses. Though such a request was made at the outset, the same was not considered althroughout the hearing of the show cause notice. It was only while taking a final decision, in the order of adjudication, the said authority dealt with such a request. In any case, the authority having relied on the statements of several witnesses, not only in the sh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... asked for cross-examination of the investigating officers. Reference to this request by the adjudicating authority was, therefore, erroneous and of no consequence. The petitioners had, in fact, asked for cross-examination of the witnesses whose statements were relied on in the show cause notices and proposed to be relied upon during the course of hearing. If the adjudicating authority did not place any reliance on the statements of these witnesses, it was within his powers to proceed further without permitting cross-examination of such witnesses to the petitioners. However, in the order of adjudication, we do not find that the adjudicating authority places no reliance on the statements of these witnesses. The petitioners had pointed out that they themselves had retracted the confessional statements at the first available opportunity. Similarly, the statements of those witnesses which were referred to by the adjudicating authority had also retracted their statements. We are not commenting on the nature of retraction and only despite such retractions of the confessional statements, the allegations could be held to have been proved against the petitioners or not. We are only examinin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this Court observed as under:- "10. Coming to the adjudication of the issue arising out of such show-cause notice dated 07.06.2007, learned counsel for the petitioner is perfectly justified in raising a grievance of the adjudicating authority having relied heavily on the statements of several witnesses who were not offered for cross examination though applied for by the petitioners. For example, our attention was drawn to the impugned order where a reference is made to the statement of one Irfan Gulam Rasul Saiyed, partner of M/s. Al-Amin Exports. In his statement dated 21.06.2003 he had admitted control and supervision of M/s. Sunshine Overseas. He had admitted that certain certificates were issued without procuring any material from the EOUs for payment of premium. His statement is further relied on to believe that the petitioners had not actually made the exports thereby indicating that the goods were diverted in the local market. Though the petitioners have applied for cross-examination of such witness admittedly, the same was not granted. This consideration is also therefore being tainted with breach of natural justice. The impugned order vis-a-vis the show-cause notice dat ..... X X X X Extracts X X X X X X X X Extracts X X X X
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