Tribunal grants appeal, orders cross-examination compliance with Section 9D.

Kishore Wadwani Versus Commissioner of Central Excise, Customs and Service Tax, Indore

Kishore Wadwani Versus Commissioner of Central Excise, Customs and Service Tax, Indore - TMI Issues Involved:
1. Rejection of the request for cross-examination.
2. Applicability and interpretation of Section 9D of the Central Excise Act, 1944.
3. Admissibility and relevance of statements recorded under Section 14 of the Act.
4. Procedural requirements for admitting statements in evidence.

Issue-wise Detailed Analysis:

1. Rejection of the Request for Cross-Examination:
The appellant challenged the decision of the Principal Commissioner rejecting the request for cross-examination of Shri CSM Altaf Alam and Shri Kotha Venkateshwarlu, communicated via a letter dated 03.06.2016. The rejection was based on the reasoning that both individuals were co-noticees and their cross-examination could cause them to incriminate themselves, citing the case of A K Jayasankaran Nambir, J N S Mahesh Versus Commissioner of Customs, Cochin [2016 (331) ELT 402 (Ker.)]. The Tribunal, however, found that an appeal is maintainable against such a decision, referencing J & K Cigarettes Ltd v CCE, 2009 (242) ELT 189 (Del) and Swiber Offshore Construction Pvt Ltd v CC, 2014 (301) ELT 119. The Tribunal overruled the preliminary objection and proceeded to analyze the merits of the case.

2. Applicability and Interpretation of Section 9D of the Central Excise Act, 1944:
Section 9D specifies the circumstances under which statements recorded before a gazetted Central Excise officer can be admitted as evidence. The Tribunal emphasized that the statements are admissible only if the conditions under Section 9D(1)(a) are met, or if the person who made the statement is examined as a witness before the adjudicating authority, as per Section 9D(1)(b). The Tribunal referred to multiple judicial precedents, including the recent judgment of the Punjab & Haryana High Court in Ambika International & others v UOI, which clarified the mandatory nature of these provisions.

3. Admissibility and Relevance of Statements Recorded under Section 14 of the Act:
The Tribunal noted that statements recorded under Section 14 cannot be used to prove the truth of their contents unless they fall within the exceptions listed in Section 9D(1)(a) or are admitted following the procedure in Section 9D(1)(b). The Tribunal highlighted the necessity of examining the maker of the statement in chief before the adjudicating authority, who must then decide if the statement should be admitted in evidence in the interest of justice. This ensures that the statements are not admitted without proper scrutiny and the opportunity for cross-examination.

4. Procedural Requirements for Admitting Statements in Evidence:
The Tribunal reiterated the procedural requirements mandated by Section 9D(1)(b). The adjudicating authority must first examine the person who made the statement as a witness and then decide if the statement should be admitted in evidence. Only after these steps can the statement be considered relevant, and the assessee must be given the opportunity to cross-examine the witness. The Tribunal cited several judicial authorities, including Sukhwant Singh v State of Punjab (1995) 3 SCC 367 and CCE v Parmath Iron Pvt Ltd, 2010 (250) ELT 514 (All.), to support this interpretation.

Conclusion:
The Tribunal allowed the appeal, setting aside the decision communicated by the letter dated 03.06.2016. The matter was remanded to the Principal Commissioner with instructions to adjudicate the Show Cause Notice in compliance with Section 9D of the Act, following the directions from the Punjab & Haryana High Court in Ambika International. The Tribunal emphasized the necessity of examining witnesses in chief and allowing cross-examination to ensure the statements' admissibility and relevance in evidence.