2009 (11) TMI 736 - AT - Central Excise

Summary

Issues involved: Alleged clandestine clearance of M.S. billets, violation of natural justice principles in passing the impugned order.

Clandestine clearance of M.S. billets: Investigation revealed that a company had clandestinely cleared M.S. billets, leading to the conclusion that another company had received and used some of these billets without following statutory formalities. The Commissioner confirmed a demand against the latter company, imposed a penalty, and confiscated their assets. The Tribunal remanded the matter for fresh adjudication due to contravention of natural justice principles.

Violation of natural justice principles: The appellants argued that the impugned order was passed without allowing them to present their case properly. They were not provided with crucial documents, including Goods Receipts (GRs) and were given incomplete and illegible copies shortly before the hearing. The Commissioner did not allow sufficient time for the appellants to review the documents and denied their request for cross-examination. The Tribunal found that the adjudication proceedings were flawed as the Commissioner rushed through without ensuring the party had access to necessary documents and the opportunity to cross-examine witnesses.

Conclusion: The Tribunal emphasized the seriousness of the charge of clandestine clearance and the need for positive evidence to support such findings. As the impugned order lacked essential details and did not allow for proper testing of disputed statements through cross-examination, the matter was remanded for a fresh decision by the Commissioner in compliance with natural justice principles. The appeal was allowed by way of remand.