1985 (3) TMI 291 - AT - Central Excise

Summary

Issues:
Appeal against order setting aside confiscation of gold ornaments under Gold (Control) Act, 1968 - Opportunity to cross-examine mahazar witnesses - Violation of principles of natural justice.

Analysis:
The case involved an appeal by the Collector of Central Excise, Madras, against an order setting aside the confiscation of gold ornaments under the Gold (Control) Act, 1968. The respondent, a licensed pawnbroker, had new gold ornaments seized from his shop without proper documentation, leading to proceedings under Sections 6(2) and 27(1) of the Act. The Collector (Appeals) set aside the confiscation and remanded the case for fresh adjudication, emphasizing the need for the respondent to be heard in accordance with natural justice principles.

The main contention revolved around the respondent's request to cross-examine the mahazar witnesses to establish that the seized ornaments were from his residence, not business premises. The Department argued that the mahazar, being a document prepared by an officer, should be given credence without the need for cross-examination. However, the respondent's counsel emphasized the importance of cross-examination in establishing the place of seizure, citing a Division Bench ruling from the Orissa High Court.

The Tribunal considered the significance of the mahazar in proving the charge under Section 6(2) against the respondent, particularly regarding the place of recovery. Given the respondent's plea and the reliance on the mahazar by the Department, the Tribunal concluded that affording the respondent an opportunity to cross-examine the witnesses was essential for a fair adjudication. The Tribunal rejected the Department's argument that natural justice principles did not mandate formal cross-examination, emphasizing the need for procedural fairness in such cases.

In light of the circumstances, the Tribunal upheld the order remanding the case for fresh adjudication, emphasizing the importance of allowing the respondent to cross-examine the mahazar witnesses. The decision was based on the fundamental principle of providing a fair opportunity for cross-examination when crucial documents are relied upon in proceedings. Consequently, the appeal by the Collector of Central Excise was dismissed, highlighting the significance of upholding natural justice principles in such matters.