2011 (5) TMI 191 - AT - Central Excise

Penalty - 100% EOU - Natural justice - Appellants would be given an effective opportunity to put their defence in person - However it clear that the appellant s request for cross-examination of various persons including the investigating officer cannot be acceded at this stage inasmuch as the investigation pertains to the period 1999 and during the course of hearing we are also informed that investigating officer has expired - As such Commissioner would decide the matter on the basis of the evidences already on record - Note that the matter is more than 10 years old expect to decide the same as early as possible and preferably within four months from the date of receipt of the present order - Hence it fit to set-aside the impugned order and remand the matter to the adjudicating authority for fresh decision.

Issues:
1. Allegation of evasion of excise duty on goods cleared for DTA.
2. Allegation of misdeclaration of quantity/grade and value.
3. Allegation of clearing rejects as firm quality goods.
4. Violation of principles of natural justice in passing the impugned order.
5. Lack of opportunity for personal hearing for the appellants.
6. Imposition of penalties without proper hearing for the distributors.
7. Decision to set-aside the impugned order and remand the matter.

Issue 1: Allegation of evasion of excise duty on goods cleared for DTA.
The judgment involves a case where M/s. Unimin India Limited, a 100% EOU, was accused of evading excise duty on goods cleared for DTA by misdeclaring quantity, grade, and value. The allegations were supported by statements from the Vice President of the unit, incriminating documents, and seized goods from the dealers. The unit was accused of receiving cash over and above the invoiced value, leading to duty evasion.

Issue 2: Allegation of misdeclaration of quantity/grade and value.
The unit was alleged to have misdeclared the quantity, grade, and value of goods cleared for DTA sales. This was supported by evidence such as private diaries, incriminating documents, and statements from dealers. The accusation was that rejects were being cleared as firm quality goods, indicating a pattern of misrepresentation and potential duty evasion.

Issue 3: Violation of principles of natural justice in passing the impugned order.
The main argument raised by the appellants' advocates was the violation of natural justice in passing the impugned order. The appellants claimed that despite requests for cross-examination and personal hearings, their rights were not upheld. The failure to provide a fair opportunity for cross-examination and personal hearings was deemed a violation of natural justice principles.

Issue 4: Lack of opportunity for personal hearing for the appellants.
The appellants contended that they were not afforded proper opportunities for personal hearings, especially regarding cross-examination of investigating officers. The judgment highlighted the appellants' insistence on cross-examination and the subsequent lack of communication or hearings, leading to a conclusion of a breach of natural justice principles.

Issue 5: Imposition of penalties without proper hearing for the distributors.
The distributors, M/s. Satish Traders and Taher & Co., faced penalties without being provided adequate opportunities for personal hearings. The change in jurisdiction and lack of hearing notices from the present Commissionerate were cited as reasons for setting aside the impugned order due to the distributors not being afforded a fair chance to present their defense.

Issue 6: Decision to set-aside the impugned order and remand the matter.
Ultimately, the judgment decided to set aside the impugned order and remand the matter to the adjudicating authority for a fresh decision. The appellants were to be given an effective opportunity to present their defense, emphasizing the importance of upholding principles of natural justice. The decision aimed to ensure a fair process and timely resolution of the case, considering the age of the matter.

This detailed analysis of the judgment covers the various issues involved, including allegations of duty evasion, misdeclaration of goods, violations of natural justice, lack of proper hearings, and the decision to remand the matter for a fresh decision.

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