TaxTMI 
TaxTMI 
2025 (11) TMI 872
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.... M/s. Fashion Boutique. According to the appellant all the relevant KYC documents of the importer which had been provided to the appellant by Vikas Aggarwal were verified before filing the Bill of Entry. However, subsequently, it was realized that there were some defects in the KYC documents and, therefore, the appellant submitted a letter dated 02.08.2021 to the Assistant/Deputy Commissioner of Customs withdrawing from the responsibility as it came to its notice that the KYC documents were not proper. 3. A show cause notice dated 09.06.2022 was issued to the appellant for revoking the Customs Broker License of the appellant alleging violation of the provisions of regulations 10(b), 10(d) and 10(n) of the Customs Broker Licensing Regulations, 2018 [the 2018 Regulations]. 4. The appellant filed a reply denying the allegations made therein. The Inquiry Officer submitted a report dated 06.09.2022 confirming the allegations made in the show cause notice. The appellant was provided an opportunity to submit comments to the report. Thereafter, the order dated 02.12.2022 was passed by the Commissioner revoking the Customs Broker License of the appellant and also ordering for forfeitu....
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....levant or material to the inquiry in regard to the grounds forming the basis of the proceedings. Regulation 17(4) provides that the Customs Broker shall be entitled to cross-examine the persons examined in support of the grounds forming the basis of the proceedings. In the instant case, the statements were not recorded by the Inquiry Officer or the Principal Commissioner of Customs and the statements were recorded under section 108 of the Customs Act before the show cause notice issued. Such persons whose statements were relied upon have not been examined by the Inquiry Officer or by the Commissioner of Customs. In fact, the Commissioner of Customs has even observed that the statements made under section 108 of the Customs Act are admissible before a court of law, more particularly when they have not been retracted. 10. This finding by the Commissioner of Customs cannot be sustained. It was imperative for the Inquiry Officer or the Commissioner to have examined the persons whose statements were intended to be relied upon and then granted an opportunity to the appellant to cross examine such persons. 11. Even with regard to proceedings under the Customs Act, statements made un....
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....ests of justice. Once this determination regarding admissibility of the statement of a witness is made by the adjudicating authority, the statement will be admitted as an evidence and an opportunity of cross-examination of the witness is then required to be given to the person against whom such statement has been made. It is only when this procedure is followed that the statements of the persons making them would be of relevance for the purpose of proving the facts which they contain." (emphasis supplied) 13. After examining various judgments of the High Courts and the Tribunal, the Tribunal observed: "28. It, therefore, transpires from the aforesaid decisions that both section 9D(1)(b) of the Central Excise Act and section 138B(1)(b) of the Customs Act contemplate that when the provisions of clause (a) of these two sections are not applicable, then the statements made under section 14 of the Central Excise Act or under section 108 of the Customs Act during the course of an inquiry under the Acts shall be relevant for the purpose of proving the truth of the facts contained in them only when such persons are examined as witnesses before the adjudicating authorit....
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....nion of India [2016 (340) E.L.T. 67 (P&H)] that section 9D is a mandatory provision and if the procedure prescribed therein is not followed, statements cannot be used as evidence in the proceedings under Central Excise Act. The relevant extracts are as follows: "13. Once the ambit of Section 9D(1) is thus recognized and understood, one has to turn to the circumstances referred to in the said sub-section, which are contained in clauses (a) and (b) thereof. 14. Clause (a) of Section 9D(1) refers to the following circumstances : (i) when the person who made the statement is dead, (ii) when the person who made the statement cannot be found, (iii) when the person who made the statement is incapable of giving evidence, (iv) when the person who made the statement is kept out of the way by the adverse party, and (v) when the presence of the person who made the statement cannot be obtained without unreasonable delay or expense. 15. Once discretion, to be judicially exercised is, thus conferred, by Section 9D, on the adjudicating authority, it is self evident inference that the decision flowing from the exercise of such ....
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....on. It is a matter of common knowledge that, on many occasions, the DRI/DGCEI resorts to compulsion in order to extract confessional statements. It is obviously in order to neutralize this possibility that, before admitting such a statement in evidence, clause (b) of Section 9D(1) mandates that the evidence of the witness has to be recorded before the adjudicating authority, as, in such an atmosphere, there would be no occasion for any trepidation on the part of the witness concerned. 19. Clearly, therefore, the stage of relevance, in adjudication proceedings, of the statement, recorded before a Gazetted Central Excise Officer during inquiry or investigation, would arise only after the statement is admitted in evidence in accordance with the procedure prescribed in clause (b) of Section 9D(1). The rigour of this procedure is exempted only in a case in which one or more of the handicaps referred to in clause (a) of Section 9D(1) of the Act would apply. In view of this express stipulation in the Act, it is not open to any adjudicating authority to straightaway rely on the statement recorded during investigation/inquiry before the Gazetted Central Excise Officer, unless and u....