TaxTMI 
TaxTMI 
TaxTMI 
2023 (12) TMI 389
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....es breach of the principles of natural justice, as the petitioner was not provided an opportunity to cross examine the persons whose statements came to be recorded in the course of the investigation. In supporting such contention, learned Counsel for the petitioner has referred to the provisions of Section 138B of the Act which provides for relevancy of statements under certain circumstances. 3. Before, we proceed to consider the rival contentions, we may refer to the relevant facts. FACTS 4. On 29 March 2000 a show cause notice was issued to the petitioner demanding differential customs duty of Rs. 2,45,83,219/- under Section 28 of the Customs Act. The petitioner had invoked the jurisdiction of the Settlement Commission. On 20 February, 2001, the Settlement Commission admitted the petitioner's application for settlement of the case. By an order dated 17 October 2003, the Settlement Commission rejected the petitioner's application on the ground that it did not have jurisdiction to entertain the application. The petitioner challenged such order of the Settlement Commission before this Court in Writ Petition No. 2 of 2004. A Division Bench of this Court by an order dated 21 July ....
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....address declared on the import documents by the petitioner as the proprietor of M/s. Sai Impex were found to be not correct. On such backdrop, summons were issued to the Clearing House Agent Mr. Deepak Bhargawa as also to the petitioner under Section 108 of the Customs Act. A statement was also recorded. The petitioner in his statement in connection with the seizure, is stated to have admitted conscious knowledge of willful mis-declaration and concealment of bearings under the guise of the consignment to be Damar Batu, imported on MS drums with an intention to smuggle the bearings of foreign origin and thereby to evade the Customs duty. There was further a statement of the petitioner recorded on 13 October 1999 under Section 108 of the Customs Act, in which he has stated that only the last two consignments he has imported vide Bill of Entries No. 000479 dated 5 October 1999 and 000393 dated 16 September 1999 where the ball bearings were concealed in the cargo of Damar Batu and the goods were to be delivered to Mr. Nitin Mehta for a consideration of Rs.10 lakhs. The petitioner has also stated that he was involved in such activities amounting to smuggling of bearings, in consultatio....
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....e. After hearing of the parties, the Commissioner of Customs had passed a detailed Order-In-Original (O-I-O) dated 28 June 2017 which runs into 118 pages. We may observe that the adjudication order extensively considers the minutest of the facts and all material which had come on record in the investigation, including the attempts as made by the petitioner in his several submissions. The adjudicating officer has also referred to the proceedings before the Settlement Commission in the two writ petitions before this Court being Writ Petition No. 3071 of 2003 and Writ Petition No. 2 of 2004 respectively, as also the orders passed thereon, as also the orders passed by the Supreme Court dated 19 August 2015. 10. Considering the voluminous material which was on the record of the adjudicating officer, namely, the Commissioner of Customs, the adjudicating officer had come to a conclusion that the show cause notice was required to be confirmed against the petitioner, by ordering confiscation of the ball bearings as seized, as also to recover customs duties of Rs. 2,45,83,219/- of the Customs Act alongwith interest as applicable under the provisions of Section 28AB of the Customs Act, as al....
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....ice by denying the cross examination in the facts and circumstances of the case. In supporting such contention, the respondents have placed reliance on the decisions in Surjeet Singh Chhabra Vs. Union of India & Ors. (1997)89 ELT 646 (SC) to contend that the cross examination of the witness would not make any material difference in the facts and circumstances of the case. Further, reliance is placed on the decision of the Supreme Court in Telestar Travels Pvt. Ltd. Vs. Special Director of Enforcement (2013(289) ELT 3 (SC)). In these circumstances, it is submitted that the petition deserves to be dismissed. Submissions of the Petitioner 14. Learned Counsel for the petitioner has limited submissions. The only contention as urged on behalf of the petitioner is that the impugned order is required to be held to be illegal as it is in breach of the principles of natural justice, on the ground that the petitioner was not permitted to cross examine the said three witnesses. It is her submission that the Commissioner of Customs could not have proceeded to pass the impugned order by not providing an opportunity to cross examine the said three witnesses as law would mandate namely the prov....
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....ze an opportunity of cross examination, would be untenable in quasi judicial proceedings namely of the adjudication of the show cause notice. It is his submission that the strict principles of evidence are applicable to the criminal trial and would not be applicable to the proceedings under the show cause notice issued under Section 124 read with Section 28 of the Customs Act. In support of his contention, Mr. Adik has placed reliance on the decision of the Supreme Court in the case Telestar Travels Pvt. Ltd. (supra), Basudev Garg (supra), as also the decision of the Madras High Court in "The Commissioner of Customs (Appeals-II) & Anr. Vs. Shri. Vijayraj Surana" W.A.No.1763 of 2021 & C.M.P. No.11024 of 2021 dt. Of decision 17/8/2021, as also the decision of the Division Bench of this Court in United Spirits Ltd. Vs. The Union of India & Anr. Writ Petition No.8516 of 2018, Decision dt. 14/6/2019. The principles as laid down in these decisions are well settled. Analysis and Conclusion 16. At the outset, we would deal with the petitioner's contention referring to the provisions of Section 138B of the Customs Act to consider whether such provision would ipso facto provide for an opp....
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....sub-section (1)(b) when the person who made the statement is examined as a witness in the case before the Court and the Court is of opinion that, having regard to the circumstances of the case, the statement should be admitted in evidence in the interest of justice. Sub-section (1) therefore clearly implies that it is only in the proceedings before the Court and in the context of any prosecution for an offence under the Customs Act, the statement of a person as recorded by the Customs Officer would be held to be relevant. 18. Insofar as the second limb of Section 138B as provided for in subsection (2) of the said provision is concerned, it clearly implies that the provisions of sub-section (1) shall apply in relation to any proceedings under the Customs Act (other than a proceeding before a Court), in a manner they apply in relation to a proceeding before a Court. In other words, the relevancy of a statement which sub-section (1) of Section 138B speaks about, would be held to be admissible and relevant even in relation to any proceeding under the Customs Act, in a manner it is so applicable before a Court as provided for under sub-section (1). 19. On such meaning which can be att....
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....such persons on behalf of the noticee in the event the statements are made before any Customs Officer, during the course of any inquiry which are subject matter of consideration in adjudication of the show cause. In our opinion, such contention as urged on behalf of the petitioner, if accepted, would militate against the provisions of clause (a) of sub-section (1) of Section 138B which also includes complete discretion which is made available to the adjudicating officer, to hold statements as recorded relevant even in given situation. When the provision itself manifest such discretion to the adjudicating officer, then any demand for cross examination would be required to be tested, in the facts and circumstances of the case, including by applying the test of prejudice which may be required to be discharged. For such reasons, we reject the contention of the petitioner that any absolute right was created by virtue of Section 138B on the petitioner to demand cross examination of the three witnesses in the facts of the present case. 20. Even otherwise, it is also important to note that show cause notice was issued in March 2000 and the request for cross-examination was made for the fi....