TaxTMI 
TaxTMI 
2022 (12) TMI 773
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....ial questions of law for consideration:- (a) Whether the Learned Tribunal is right in allowing CENVAT Credit, so availed by the respondents, as eligible/admissible credit on inputs/raw materials as defined under Rule 9(5) of the CENVAT Credit Rules, 2004 when the respondents could not satisfactorily account for the transportation/receipt of such inputs/raw materials to their premises? (b) If the answer the question (a) hereinabove is yes, then whether the findings of the Learned Tribunal, which is not in consistent with the said statements/admitted facts, is perverse? (c) Whether, being the last fact finding authority, the findings of the Learned Tribunal, as regards to the transportation vehicles, is perverse since the said findings overlooked the fact that some of vehicles are three wheelers, moped etc. which cannot be used for transporting the raw materials which are used by the respondents for manufacturing the final products in their factory? (d) Whether the Learned tribunal is right in not considering that the respondents herein failed to produce any conclusive evidence in relation to inward movement of raw materials? (e) Whether t....
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....arned tribunal which was allowed. 5. On going through the order passed by the learned Tribunal, we find that what weighed in the mind of the tribunal was that during the course of search at the factory premises of the respondent incriminating documents were not recovered nor any shortage/excess of raw materials/finished goods were found by the officers of the anti evasion wing. Further the tribunal held that the statement recorded under Section 14 of the Act cannot be relied upon as the evidence unless the provisions of the Section 9D of the Act had been followed. It referred to a decision of the Tribunal and that of the High Court of Punjab and Haryana in the case of G-Tech Industries Versus Union of India and Others 2016 (339) ELT 209 P&H, and held that the adjudicating authority is required to first conduct examination in chief of the witness whose statement is relied upon by the department and then to form an opinion whether the statements of the witness is admissible in evidence with respect to the facts and circumstances of the case and then only the witness shall be offered for cross examination. Having found that no such examination in chief had been conducted by the adj....
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....(SC), • Assistant Collector of C.EX., Rajamundry Versus Duncan Agro Industries Limited 2000 (120) ELT 280 (SC), • A.L. Jalaludeen Versus Dy. Dir. Of Enforcement Directorate, Chennai 2010 (261) ELT 84 (Mad), • Kishanlal Agarwalla Versus Collector of Land Customs AIR 1967 Cal 80, • Patel Engineering Limited Versus Union of India 2014 (307) ELT 862 (Bom), • Tapan Kumar Biswas Versus Union of India 1996 (63) ECR 546 Calcutta. 7. Mr. Somak Basu, after elaborately referring to the findings rendered by the tribunal supported the decision of the learned tribunal by referring to the decisions which were cited by the respondent before the tribunal as to how there has been violation of Section 9D of the Act and to support such contention placed reliance on the decision in Hi Tech Abrasives Limtied Versus Commissioner of Central Excise and Customs, Raipur 2018 (362) ELT 961 (Chattisgarh). Further it is submitted that denial of cross examination has taken away a valuable right to the respondent which was considered by the tribunal and the relief was granted. In this regard, reliance was placed on the decision in:- â€....
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....ays is an admission and binding since the customs officers are not police officers, and also as could be seen from the language of Section 108 of the Customs Act. Further, under the scheme of the Act the right to cross examination is not absolute and denial of cross examination was held to be valid upon sound logic and if the same had been done such orders of adjudication have been upheld. Further it has been pointed out that natural justice must not be strained to become artificial justice; procedural justice according to statutes or under statutory rules are different from concepts of natural justice and the procedure under the statute or the rule must governed and if the customs officers (or the Central Excise Officers) were to conduct himself to a regular court of law hearing formal cross examination and applying Evidence Act and Civil and Criminal Procedure Code then it will be physically and literally impossible for him to function as an adjudicating authority. Thus, the underlying legal principle is that each case has to be decided on its own facts and we are to consider as to whether the plea raised by the respondent before the Tribunal that cross examination was not permit....
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....mitted during the course of hearing but the respondent has not touched upon the factual position. They never argued authenticating the availment and utilization of CENVAT Credit by them. They never disputed the non-existing status of noticee No. 2 to Noticee No. 7. The adjudicating authority reiterates that the submissions of the respondent was by using technical words and relying upon certain decisions which do not have any bearing on the facts of the case. Based on documents, the adjudicating authority concluded that noticees no. 2 to 7 obtained Central Excise Registration for manufacture of mainly iron and steel items but issue cenvatable invoices without manufacturing anything and passed a considerable large amount of CENVAT Credit to various dealers and manufacturers. Furthermore, the respondent could not establish by any record to show that the noticees 2 to 7 were existing and carrying on operations. Furthermore, the respondent has accepted the fraudulent nature of the invoices. In the course of adjudication of the show cause notice a faint plea has been raised stating that the vehicles owners have to be cross examined. We find from the order of adjudication details of appro....
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....ent availment of credit and consequently, the tribunal erred in reversing the order passed by the adjudicating authority. 13. Mr. Basu placed reliance on the decision of the Hon'ble Supreme Court in Nirmal Singh Pehlwan Versus Inspector, Customs, Customs House Punjab 2011 12 SCC 298 and contended that the statements recorded from his client under Section 108 of the Customs Act is not admissible in evidence and the same could not have been used. For the same proposition, reliance was also placed on the decision of the High Court of Andhra Pradesh in the case of The Assistant Collector of Central Excise, Rajahmundry Division Versus Duncan Agro Industries Limited 1991 SCC Online AP 161. Mr. Bhattacharya, learned standing counsel appearing for the respondent had referred to various paragraphs of both the above mentioned judgments and submitted that both the judgments the case was relating to criminal prosecution and in the decision in the case of Nirmal Singh Pehlwan, it was the prosecution initiated under the provisions of the Narcotic Drugs and Psychotropic Substances Act, 1985 and those decisions will not have any application to the facts of the case. The learned senior standing ....
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....in it was held that the officers of the Revenue Intelligence and the officers of the Customs Department could not be said to be police officers and a confession before them would not be hit by Section 25 of the Evidence Act. The Hon'ble Supreme Court concluded by holding that in the decision in Kanhaiyalal, the Court had not examined the principles and the concept underlining Section 25 of the Evidence Act vis-à-vis Section 108 of the Customs Act and the power of Customs Officer who could investigate and bring for trial an accused in a narcotic matter. The decision in Noor Aga which was a later judgment was held to be more elaborate on that issue. Therefore, it was held that the provision of Section 850 of the Narcotic Drugs and Psychotropic Substances Act has to be mandatorily complied with. Thus, the facts clearly show that the Hon'ble Supreme Court was considering a case as to whether, a person could be bound over by his statement recorded by the Customs Officer under Section 108 of the Customs Act while he is being charged of an offence under the provisions of Narcotic Drugs and Psychotropic Substances Act. The other question which was the crux of the issue before the Ho....