TaxTMI 
TaxTMI 
2000 (1) TMI 246
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....G(1), Rules 45, 47, 51 and 52 read with Rules 52A, 53 and 226 of the Central Excise Rules. 2. Facts giving rise to this appeal are briefly stated as under : 3. The appellants are engaged in the manufacture of cotton/yarn and cotton fabrics covered by T.I. 18A and 191 of the Central Excise Tariff 1944 (sic) up to 28-2-1986 and thereafter under Chapters 54 and 55 of the Central Excise Tariff Act, 1985 and also of man-made fabric and yarn covered by T.I. 221, 181-II and 18E of the Central Excise Tariff 1944 upto 28-2-1986 and thereafter under Chapters 54 and 55 of the Central Excise Tariff Act, 1985. They are holders of the Central Excise licence, L-4 CF/21/49 CY-1/61 and ASF-48/63. On 16-6-1987 the appellants filed for the fir....
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....d the premises of some of the customers of the appellants and made enquiries. They recorded statement of Mukesh Chawala who was a partner in the standard agencies and quality traders, the customers of the appellants on 7-3-1988. The samples of the fusible interlining fabrics purchased from M/s. Mafatlal Apparel Mfg. Co. Ltd. were also drawn by the officers on 8-3-1983 and documents were also seized. The statements of Shri B.R. Desai, Deputy Sales Manager of M/s. Mafatlal Apparel Mfg. Co. Ltd. was recorded. The preliminary investigations by way of scrutiny of all the records showed that M/s. Mafatlal Apparel Mfg. Co. Ltd. did procure ICL machine in the year 1981 and installed the same in the premises of the appellants' factory who manufactur....
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.... notice was accordingly issued to the appellants for having misclassified the product with a view to evade the Central Excise duty and concealed the true facts from the Excise department and removed the goods in a clandestine manner without paying proper duty. They were called upon to pay the differential duty and penalty was also proposed to be imposed on them. The appellants, however, contested the correctness of the show cause notice. They denied the allegations made therein. They denied of having misdeclared HDPE coated fusible interlining fabric as bleached sheeting, dye sheeting, mafinised sheeting etc. under T.I. 191-II of the erstwhile 1st schedule of the Central Excises & Salt Act, 1944 instead of declaring the same as HDPE coated ....
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....this order in original the appellants have come in appeal. 8. We have heard the learned Counsel and the learned DR. 9.  The learned Counsel for the appellants has at the outset contended that there had been violation of principles of natural justice while adjudicating the matter as the Collector did not afford them opportunity to cross-examine the witnesses on the statements of which he had recorded the findings about the classification of their product under sub-heading 5903.19 by holding it as cotton fabric coated and laminated with HDPE Moulding powder. Therefore, the impugned order deserves to be set aside and the case to be sent back for readjudication after allowing them opportunity to cross-examine the witnesses. 1....
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....iage of justice when the appellants had not been afforded proper opportunity to substantiate their version. Therefore, on this score alone, the impugned order of the Collector deserves to be set aside and the case has to be remanded to the Collector for readjudication afresh after complying with the principles of natural justice by affording proper opportunity to the appellants to cross-examine the witnesses whose statements were recorded during the course of investigation at their back by the Central Excise Officers. The Collector has also failed to take note of the fact that the classification lists was also filed in respect of the product not only under the old Tariff when the same was in force, but also under the new Tariff and there is....