TaxTMI 
TaxTMI 
2025 (3) TMI 686
X X X X Extracts X X X X
X X X X Extracts X X X X
....en filed by Shri Manoj K Jain against the Interlocutory Order dated 21.03.2012, whereby the Ld. Special Director, Enforcement Directorate had denied the request to seek the cross-examination of (i) Officer who recorded the statement of the Appellant under the provision of Custom Act, 1962 and (ii)Officer who recorded the statement of conoticees under the provisions of FERA. The Appeal FPA-FE-13/HYD/2012 has been filed by Shri Bimal K Jain against the Interlocutory Order dated 14.03.2012, whereby the Ld. Special Director, Enforcement Directorate had denied the request to seek the cross-examination of (i) Officer who recorded the statement of the Appellant under the provision of Custom Act, 1962 and (ii) Officer who recorded the statement of Appellant under the provisions of FERA, (iii) Persons who had purportedly received payments from the Noticees, namely, Shri Rajnish Agarwal or Sanjay Agarwal, and (iv) Manager of Centurion Bank. Ld. Counsel for the Appellants have pleaded that the Impugned Orders suffer from the vice of non-application of mind. Ld counsel argued that by denying the request for cross-examination, the Impugned Orders are in breach of principles of Natural Justice....
X X X X Extracts X X X X
X X X X Extracts X X X X
....natural justice are flexible principles and cannot be applied in any straitjacket formula. Therefore, the absence of any formal opportunity of cross-examination per se does not invalidate or vitiate the decision arrived at fairly unless the Appellants can prove the definite inference of the likelihood of prejudice flowing from the refusal to allow cross-examination of the concerned witness. The decision of the Hon'ble Supreme Court in Kanungo & Company v. Collector Of Customs And Ors, AIR 1972 SC 2136, has laid down that in all cases cross- examination of a witness may not be necessary : - "12. We may first deal with the question of breach of natural justice. On the material on record, in our opinion, there has been no such breach. In the show-cause notice issued on August 21, 1961, all the material on which the Customs Authorities have relied was set out and it was then for the appellant to give a suitable explanation. The complaint of the appellant now is that all the persons from whom enquiries were alleged to have been made by the authorities should have been produced to enable it to crossexamine them. In our-opinion, the principles of natural justice do not require that....
X X X X Extracts X X X X
X X X X Extracts X X X X
....tion which has been carved out to the aforesaid principle by the Courts. Even if it is found by the Court that there is a violation of principles of natural justice, the Courts have held that it may not be necessary to strike down the action and refer the matter back to the authorities to take fresh decision after complying with the procedural requirement in those cases where non-grant of hearing has not caused any prejudice to the person against whom the action is taken. Therefore, every violation of a facet of natural justice may not lead to the conclusion that order passed is always null and void. The validity of the order has to be decided on the touchstone of 'prejudice'. The ultimate test is always the same, viz., the test of prejudice or the test offair hearing." The three Judge bench decision of the Hon'ble Supreme Court in State of U.P. v. Sudhir Kumar Singh, (2021) 19 SCC 706, has summarized the effects of the violation of the principles of Natural Justice. "42. An analysis of the aforesaid judgments thus reveals: 42.1. Natural justice is a flexible tool in the hands of the judiciary to reach out in fit cases to remedy injustice. The breach of the audi al....
X X X X Extracts X X X X
X X X X Extracts X X X X
....the appellants was in the nature of production in terms of Section 139 of the Evidence Act, where the witness producing the documents is not subjected to cross examination. Such being the case, the refusal of the Adjudicating Authority to permit cross examination of the witnesses producing the documents cannot even on the principles of Evidence Act be found fault with. At any rate, the disclosure of the documents to the appellants and the opportunity given to them to rebut and explain the same was a substantial compliance with the principles of natural justice. That being so, there was and could be no prejudice to the appellants nor was any demonstrated by the appellants before us or before the Courts below. The third limb of the case of the appellants also in that view fails and is rejected." Appellants have relied on the judgments of Calcutta High Court in Ajay Saraogi versus Union of India, 2023 SCC Online Cal 2564; and the judgment of Delhi High Court in Shahid Balwa versus The Directorate of Enforcement in LPA No. 79/2013 dated 29.05.2013 to press their case. Respondent have stated that the Hon'ble Supreme Court in Special Leave Petition (Civil) 2823128232/2013 titled Dir....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... has referred to Final Order No. 433 to 435/07 dated 02/04/2007 in the matter of Shri Manoj Kumar Jain versus Customs Commissioners issued by the Customs, Excise and Service Tax Appellate Tribunal to argue that the request of cross-examination of the concerned departmental officers should be granted. We are unable to accept the contentions of the Appellant as the proceedings under Customs Act are factually different from the present proceedings under FERA. We are in agreement with the observations of the Ld. Special Director in the Impugned Interlocutory Order dated 21.03.2012. We have extracted the relevant paragraphs hereinbelow: "4.1.3 As mentioned previously, the above orders of the Hon'ble CESTAT relate to proceedings under the Customs Act, 1962 where on the issue of non-compliance with principles of natural justice, these orders remanding the matter for fresh adjudication came to be passed. 4.1.4 On the applicability of the CESTAT orders to the proceedings under FERA before me, the following Reeds to Be Brought out:- 1) It is not the case of the Noticees that in the instant proceedings, they have not been provided with the copies of the relevant documents alongwith ....