TaxTMI 
TaxTMI 
TaxTMI 
2025 (9) TMI 673
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....f fraudulent invoices issued by M/s Vasu Alloys. On the allegations, a show cause notice dated 30.03.2021 was issued by invoking extended period of limitation under Rule 14 of the CENVAT Credit Rules, 2004 read with Section 11(A)(4) of the Central Excise act, 1944 for disallowing and recovering of CENVAT credit of Rs.3,66,066/- availed wrongly and further imposed penalty under Rule 26 of the Central Excise Rules, 2002 on his Director, Shri Naresh Kumar Gupta. The appellant filed a detailed reply to the show cause notice and has raised that there is no evidence of fraudulent invoice and also requested for cross-examination and supply of adverse material in the form of statements relied upon by the Department. After following the due process, the Department confirmed the demand vide its Order dated 31.0.2023 on the ground that the supplier of the inputs is bogus. Aggrieved by the said order, the appellant filed appeal before the Commissioner, who also did not exceed to the request of the appellant for cross-examination of the material witness, whose statement was relied upon by the Revenue and rejected the appeal of the appellant. Hence, the present appeals. 3. Heard both sides and ....
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....: M/s Lauls Ltd, Faridabad (Noticee No. 1) in their reply dated 30.9.2009 had asked for cross-examination of the witnesses whose statements had been relied upon in the show cause notice, but thereafter they did not stress for cross-examination of said witnesses. Even during the personal hearing held on 23.11.2009 before the then Commissioner of Central Excise, Delhi-IV, Faridabad, no such request for cross-examination of witnesses was stressed either by the Advocate or S/Shri Sudhir Gupta and Abhay Gupta, Directors of Noticee No. 1, who had appeared for personal hearing for and on behalf of M/s Lauls Ltd and Noticee No. 2-Shri Abhay Gupta. However, the Noticee No. 1 again made the request for cross-examination of witnesses during the course of personal hearing held on 25.5.2011, which was the IVth date of hearing and the Noticee No. 1 had already been specifically informed vide office letter C. No. V(72)15/Commr/CE/2008/4027-28 dated 16.5.2011 that 25.5.2011 was the last and final date of hearing and accordingly the Counsel of Noticee No.1 as well as S/Shri Abhay Gupta and Sudhir Gupta, Directors of Noticee No.1 who had appeared for personal hearing on 25.5.2011 were informed that ....
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.... under Section 9D, if he chooses to invoke clause (a) of sub-section (1) thereof, would be pregnable to challenge. While the judgment of the Delhi High Court in J&K Cigarettes Ltd. (supra) holds that the said challenge could be ventilated in appeal, the petitioners have also invited attention to an unreported short order of the Supreme Court in UOI and Another v. GTC India and Others in SLP (C) No. 2183/1994, dated 3-1-1995 wherein it was held that the order passed by the adjudicating authority under Section 9D of the Act could be challenged in writ proceedings as well. Therefore, it is clear that the adjudicating authority cannot invoke Section 9D(1)(a) of the Act without passing a reasoned 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 per....
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....on 9D(1). In all other cases, if he wants to rely on the said statement as relevant, for proving the truth of the contents thereof, he has to first admit the statement in evidence in accordance with clause (b) of Section 9D(1). For this, he has to summon the person who had made the statement, examine him as witness before him in the adjudication proceeding, and arrive at an opinion that, having regard to the circumstances of the case, the statement should be admitted in the interests of justice. 20. In fact, Section 138 of the Indian Evidence Act, 1872, clearly sets out the sequence of evidence, in which evidence-in-chief has to precede cross-examination, and cross-examination has to precede re-examination. 21. It is only, therefore, - (i) after the person whose statement has already been recorded before a Gazetted Central Excise Officer is examined as a witness before the adjudicating authority, and (ii) the adjudicating authority arrives at a conclusion, for reasons to be recorded in writing, that the statement deserves to be admitted in evidence, that the question of offering the witness to the assessee, for cross-examination, can arise. We find that the Hon'ble High....
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....We may also point out that on an earlier occasion when the matter came before this Court in Civil Appeal No. 2216 of 2000, order dated 17-3-2005 [2005 (187) E.L.T. A33 (S.C.)] was passed remitting the case back to the Tribunal with the directions to decide the appeal on merits giving its reasons for accepting or rejecting the submissions. 12. With due difference to the Hon'ble Supreme Court and Hon'ble High Court of (Punjab & Haryana), we find that not allowing the cross-examination of key witnesses vitiates the proceedings even under the quasi-judicial proceedings. Therefore, as requested by the learned Counsel for the appellants, we are inclined to accept the contention and the request of learned Counsel for the appellants that the interest of justice would be properly served if the case goes back to the Adjudicating Authority to adjudicate the case afresh after giving the opportunity to the appellants to cross-examine the key witnesses whose statements have been relied upon by the impugned order. 5. Learned Counsel has also produced on record the judgment in the case of M/s Mittal Ceramics Vs Commissioner of CGST, Ludhiana (Final Order No.60592-60593/2024 dated 07.11.202) and....