Retraction and cross-examination in adjudication: corroborated statements remained reliable, and the natural justice challenge failed.

A retracted inculpatory statement may be relied upon in adjudication where it is voluntary, the retraction is considered, and independent documentary material corroborates it; the statements here were supported by seized records and other cogent evidence, so they were admissible. Denial of cross-examination did not vitiate the order because the relied upon documents had been supplied or inspected, the noticees had opportunities to explain the material, and no prejudice was shown. The challenge to the adjudication therefore failed, and the findings of contravention were sustained on the record.

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Issues: (i) Whether the adjudication order was vitiated for breach of natural justice by denial of cross-examination and alleged non-supply of relied upon materials; (ii) Whether the retracted statements recorded under the foreign exchange law could be relied upon when corroborated by seized documents and other independent material.

Issue (i): Whether the adjudication order was vitiated for breach of natural justice by denial of cross-examination and alleged non-supply of relied upon materials.

Analysis: The relied upon documents had been made available and inspected by the noticees, and the materials forming the basis of the notice were explained in their own statements. The request for cross-examination was not found necessary because the statements were explanatory of documents recovered during search and the proceedings had already afforded repeated opportunities of hearing. No prejudice was shown from the refusal of cross-examination.

Conclusion: The order was not vitiated on the ground of violation of natural justice, and the denial of cross-examination was justified.

Issue (ii): Whether the retracted statements recorded under the foreign exchange law could be relied upon when corroborated by seized documents and other independent material.

Analysis: A retracted statement is not automatically inadmissible. It can be acted upon when voluntary in character, the retraction is considered, and the statement is supported by independent documentary evidence. Here, the statements were recorded under the foreign exchange law, were considered despite retraction, and stood corroborated by the seized records and other cogent material.

Conclusion: The retracted statements were admissible and could validly be relied upon against the appellants.

Final Conclusion: The challenge to the adjudication failed on merits, as the findings on contravention were supported by material on record and no procedural illegality warranting interference was established.

Ratio Decidendi: A retracted inculpatory statement may be relied upon in adjudication when it is considered along with the retraction and is independently corroborated by documentary evidence, and refusal of cross-examination does not vitiate the order where disclosure of relied upon documents and prior opportunity to explain them have afforded substantial compliance with natural justice.

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