2009 (8) TMI 982 - AT - Central Excise

Summary

Issues involved: Appeal against demand of duty and penalties imposed, denial of natural justice during adjudication proceedings.

Demand of duty and penalties:
The case involved M/s. Meenakshi Re-rollers Pvt. Ltd. and Shri Nikhil Bansal aggrieved by a demand of duty over Rs. 7.5 crores for clandestinely manufactured MS Ingots. The show-cause notice invoked Section 11A(1) of the Central Excise Act and proposed penalties u/s 11AC and Rules 25, 26 of the Central Excise Rules, 2002. The department relied on an expert opinion for determining energy consumption and proposed a total duty of over Rs. 7.5 crores, including appropriation of the amount already paid by the appellants.

Denial of natural justice:
The appellants raised grievances regarding denial of natural justice during adjudication proceedings. They requested copies of documents, English translations, and cross-examination of witnesses, which were partially allowed by the Commissioner. The main contention was the denial of cross-examination of key witnesses and the lack of English translations hindering effective participation in the proceedings. The appellants argued that they were not given a fair opportunity to respond to the show-cause notice, emphasizing the importance of English translations for effective participation.

Judgment:
Upon examination, the Tribunal found merit in the appellants' grievances regarding denial of natural justice. The Commissioner's order was set aside, and the appeals were allowed by way of remand. The Tribunal directed the Commissioner to pass a fresh order of adjudication, providing the appellants with a reasonable opportunity for obtaining English translations, cross-examining witnesses, and being personally heard. Emphasis was placed on the need for a speaking order addressing all issues and ensuring that evidence collected through the Panchnama is duly considered.