2020 (12) TMI 539 - HC - Customs

High Court Ruling on Customs Duty Confiscation and Witness Rights

Laurel Apparels Pvt. Ltd. Versus The Commissioner of Central GST And Central Excise, Surat 1

The High Court addressed various issues including confirmation of Customs Central Excise Duty forgone, confiscation of goods, denial of cross-examination ... Imposition of penalties - violation of Principles of natural justice - invocation of of Section 112 (a) and Section 112(b) of the Customs Act, 1962 simultaneously - denial of cross-examination of the panchas and other witnesses - HELD THAT:- The tax appeal under Section 130 of the Customs Act, 1962 and Section 35 G of the Central Excise Act, 1944 is ordered to be admitted on the substantial questions of law. Issue Notice to the respondent. Issues involved:1. Confirmation of Customs Central Excise Duty forgone2. Confiscation of goods3. Denial of cross-examination of witnesses4. Violation of the principle of natural justice5. Ignoring directions of the co-ordinate bench6. Upholding demand for a larger period7. Passing order without findings on penalties and interest8. Violation of principles of natural justiceConfirmation of Customs Central Excise Duty forgone:The High Court addressed the issue of whether the Appellate Tribunal was justified in confirming the Customs Central Excise Duty forgone. The Court examined the facts and circumstances of the case along with the legal aspects involved. The appellant's counsel argued before the Court, raising substantial questions of law in this regard.Confiscation of goods:Another issue dealt with by the Court was the confirmation of the confiscation of goods by the Appellate Tribunal. The Court analyzed the facts and circumstances surrounding the confiscation, assessing whether the Tribunal's decision was legally sound and justified based on the evidence presented during the proceedings.Denial of cross-examination of witnesses:The Court deliberated on whether the Appellate Tribunal was correct in not allowing cross-examination of the panchas and other witnesses crucial to the case. The issue of whether the denial of cross-examination violated the principle of natural justice was also examined in detail during the proceedings.Ignoring directions of the co-ordinate bench:The Court considered whether the Appellate Tribunal erred in ignoring the directions of the co-ordinate bench regarding the referral of the matter to the Development Commissioner in the case of 100% EOU before taking any action. The Tribunal's decision to accept the explanation of the Learned Commissioner for not following the direction given in the earlier round of litigation was scrutinized.Upholding demand for a larger period:The High Court assessed whether the Appellate Tribunal was correct in upholding the demand for a larger period based on the willful evasion of duty. The Court examined the detailed investigation conducted by the revenue and the recorded statements of various individuals to determine the validity of the Tribunal's decision.Passing order without findings on penalties and interest:The issue of the Appellate Tribunal passing an order without providing findings and reasoning on penalties and interest was also addressed by the Court. The legality and procedural correctness of such an order were thoroughly analyzed during the proceedings.Violation of principles of natural justice:Lastly, the Court considered whether the order passed by the Appellate Tribunal amounted to a violation of the principles of natural justice. The Court examined the points raised before the Tribunal that were disregarded without proper findings, assessing the impact on the overall fairness and justice of the proceedings.In conclusion, the High Court issued notices to the respondent and set a returnable date. Additionally, the Court ordered that no coercive steps shall be taken towards the recovery of demand until the next hearing date.