2017 (1) TMI 215 - AT - Central Excise

Tribunal overturns duty demand order due to lack of cross-examination, emphasizes natural justice principles.

M/s. Associated Pigments Ltd., Shri H.K. Verma, Authorised Signatory, Shri S.N. Sahaya, Director, Shri V.K. Jain, Authorised Signatory Versus C.C.E. Jaipur

The Tribunal set aside the order confirming duty demand and penalties for alleged clandestine removal of goods due to the lack of cross-examination of ... Clandestine removal - natural justice - request by appellants for cross-examination of drivers were ignored by Ld. Commissioner (A) - Held that: - to decide the case the cross examination of witness is necessary as per section 9(D) of the Central Excise Act 1944 and without giving cross examination of witness is gross violation of principle of natural justice, therefore matter needs to be re-adjudicated after giving cross examination of the witness as per the procedure laid down in the section 9(D) of the Central Excise Act 1944 - matter on remand - appeal disposed off. Issues:Appeal against duty demand and penalty imposition based on alleged clandestine removal of goods. Request for cross-examination of transporters. Adjudicating authority's failure to consider cross-examination request. Violation of natural justice principles.Analysis:The appellants challenged an order confirming duty demand and penalties for alleged clandestine removal of goods. Despite the absence of the appellants or any adjournment request, the appeals were heard on merits. The case hinged on the cross-examination of drivers/transporters who provided incriminating statements against the appellants. The appellants sought cross-examination of all relevant transporters, but the adjudicating authority did not address this request. The impugned order noted the appellants' contention regarding the lack of consideration for cross-examination requests, stating that no such request was made before the adjudicating authority. However, the Commissioner's finding on this matter was deemed factually incorrect as the adjudicating authority had documented the appellants' request for cross-examination.The Tribunal found the impugned order lacking in merits and set it aside. Emphasizing the necessity of witness cross-examination under Section 9(D) of the Central Excise Act 1944, the Tribunal highlighted the violation of natural justice principles due to the absence of cross-examination. Consequently, the matter was remanded back to the adjudicating authority for a fresh decision following the procedures outlined in Section 9(D) of the Act. The Tribunal directed the authority to conduct the necessary cross-examination and then decide the case on its own merits. The appeals were disposed of accordingly.