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of <h1>High Court overturns excise duty order due to procedural error, emphasizing right to cross-examination</h1> <h3>Mahek Glazes (P.) Ltd. Versus Union of India</h3> The High Court set aside an order confirming excise duty demands, interest, and penalties due to a serious breach of natural justice principles. The Court ... Principle of natural justice – order of adjudicating authority rejecting the application for cross examination - right to cross examine - Held that:- the petitioners had atleast a right to be told whether such application is being granted or refused before final order was passed. When the petitioners prayed for cross examination and reasonably expected that the same would be granted, they cannot be expected to participate in the adjudicating proceedings upto the final stage. - Principles of natural justice breached - order would be set aside - Petitioner had a right to know the outcome of their application - commissioner should issue a notice for further hearing – petition allowed in the favour of the assessee. Issues:Challenge to order of Commissioner of Customs & Central Excise, breach of principles of natural justice, request for cross-examination of witnesses, refusal of cross-examination request, failure to inform petitioners of outcome before passing final order, setting aside impugned order, requirement of separate order on cross-examination request, examination of request for certain documents.Breach of Principles of Natural Justice:The petitioners challenged an order confirming excise duty demands, interest, and penalties passed by the Commissioner of Customs & Central Excise. The High Court entertained the writ petition directly due to a prima facie case of breach of natural justice principles. The petitioners contended that the impugned order was issued without disposing of their request for cross-examination of witnesses. The adjudicating authority acknowledged the request but rejected it, proceeding to confirm the duty demands. The High Court found a serious breach of natural justice as the authority failed to inform the petitioners of the outcome of the cross-examination request before passing the final order.Cross-Examination Request:The petitioners insisted on cross-examining witnesses before participating fully in the adjudication proceedings. Despite the authority's rejection of the request, the High Court emphasized that the petitioners had the right to know the decision on their application before the final order was issued. The Court highlighted that the authority should have either granted or rejected the cross-examination request with reasons before concluding the adjudication process. The Court set aside the impugned order and directed a separate order specifically addressing the petitioners' application for cross-examination of witnesses.Requirement of Separate Order:The High Court directed the adjudicating authority to pass a distinct order on the petitioners' request for cross-examination. Even though the Commissioner had already addressed this issue in the impugned order, the Court emphasized the need for a fresh order due to setting aside the original decision. The Court clarified that the same officer could issue the new order without the need for a separate hearing. The Commissioner was instructed to evaluate the relevance of the cross-examination of witnesses as requested by the petitioners.Examination of Document Request:Additionally, the petitioners had requested certain documents, which the Commissioner was directed to examine before proceeding with the adjudication process. The High Court instructed the Commissioner to consider this aspect of the matter and issue a notice to the petitioners for further hearing of the show cause notice in accordance with the law.This judgment underscores the importance of upholding principles of natural justice, ensuring that parties are informed of decisions on their requests before final orders are passed, and addressing specific requests such as cross-examination and document production in a separate and transparent manner during adjudication proceedings.
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