TaxTMI 
TaxTMI 
2025 (6) TMI 548
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....atement of various persons, including the appellant, were recorded and ultimately a show cause notice dated 04.12.2000 was issued to 26 persons including the appellant. 3. The case setup by the department in the show cause notice is that Sundram Export exported 96,800 pieces of CD-ROMs at highly inflated Freight on Board [FOB] value of US 19$ per piece. Another exporter, by name of Netcompware, also exported a consignment of 40,000 pieces of CDROMs at overvalued price of US 19$ per piece. The 5 shipping bills covering the above exports were filed under the DEPB Scheme. According to the department, the overvalued export was used by the exporter to fraudulently procure DEPB scrips from the Directorate General of Foreign Trade [DGFT] and subsequently these DEPB scrips were sold in the open market and were thereafter used by companies to import goods without payment of duty. It is also the case of the department that the 40,000 CD-ROMs exported by Netcompware to Hong Kong were subsequently re-imported and cleared by M/s. Arvind International [Arvind International] under a Bill of Entry dated 08.09.1998. It is said that the appellant was connected with Sundram Exports and had exp....
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....er indicates that the retraction filed by Shri Bimal Kumar Jain was mere afterthought to save himself as it is not supported by material evidences on record. Therefore, the case laws cited by him in his defence reply do not apply in this case. Culpability of Shri Bimal Kumar Jain is established beyond any doubt." (emphasis supplied) 6. Shri Naveen Malhotra, learned counsel of the appellant assisted by Shri Ritvik Malhotra made the following submissions: (i) The goods once exported do not fall within the ambit of "export goods" as defined under section 2(19) of the Customs Act. Thus, the provisions of the Customs Valuation (Determination of Value of Export Goods) Rules, 2007 [the Customs Valuation Rules] cannot be invoked for re-determining the valuation of the goods. In support of this contention, learned counsel placed reliance upon the judgment of the Punjab and Haryana High Court in Jairath International vs. Union of India [2019 (370) E.L.T. 116 (P & H)] ; (ii) The impugned order is based on the statements made by the appellant, Sulekh Chand Jain, Surinder Kumar, Deept Swarup Aggarwal, Sandeep Mehra, Rajesh Aggarwal and Rajesh Jain under section 108 of the Customs Act. Su....
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....se Act and section 108 of the Customs Act enable the concerned Officers to summon any person whose attendance they consider necessary to give evidence in any inquiry which such Officers are making. The statements of the persons so summoned are then recorded under these provisions. It is these statements which are referred to either in section 9D of the Central Excise Act or in section 138B of the Customs Act. A bare perusal of sub-section (1) of these two sections makes it evident that the statement recorded before the concerned Officer during the course of any inquiry or proceeding shall be relevant for the purpose of proving the truth of the facts which it contains only when the person who made the statement is examined as a witness before the Court and such Court is of the opinion that having regard to the circumstances of the case, the statement should be admitted in evidence, in the interests of justice, except where the person who tendered the statement is dead or cannot be found. In view of the provisions of sub-section (2) of section 9D of the Central Excise Act or sub-section (2) of section 138B of the Customs Act, the provisions of sub-section (1) of these two Acts shall ....
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....e of being recorded under coercion or compulsion and it is in order to neutralize this possibility that statements of the witnesses have to be recorded before the adjudicating authority, after which such statements can be admitted in evidence." (emphasis supplied) 12. In Drolia Electrosteel, the Tribunal had also while examining the provisions of section 9D of the Central Excise Act held: "13. Of the above, the 35 statements of various persons recorded under the Central Excise Act will be relevant to the proceedings only as per section 9D which lays down the procedure to be followed to make them relevant and the exceptions to such procedure.***** 14. Evidently, the statements will be relevant under certain circumstances and these are given in clauses (a) and (b) of sub-section (1). There is no assertion by either side that the circumstances indicated in (a) existed in the case. It leaves us with (b) which requires the court or the adjudicating authority to first examine the person who made the statement and form an opinion that having regard to the circumstances of the case, the statement should be admitted in evidence. Of course, the party adversely affect....
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....and speaking order in that regard, which is amenable to challenge by the assessee, if aggrieved thereby. 16. If none of the circumstances contemplated by clause (a) of Section 9D(1) exists, clause (b) of Section 9D(1) comes into operation. The said clause prescribes a specific procedure to be followed before the statement can be admitted in evidence. Under this procedure, two steps are required to be followed by the adjudicating authority, under clause (b) of Section 9D(1), viz. (i) the person who made the statement has to first be examined as a witness in the case before the adjudicating authority, and (ii) the person who made the statement has to first be examined as a witness in the case before the adjudicating authority, and 17. There is no justification for jettisoning this procedure, statutorily prescribed by plenary Parliamentary legislation for admitting, into evidence, a statement recorded before the Gazetted Central Excise Officer, which does not suffer from the handicaps contemplated by clause (a) of Section 9D(1) of the Act. The use of the word "shall" in Section 9D(1), makes it clear that, the provisions contemplated in the sub-section are mandatory. Indeed, as....