2017 (6) TMI 415 - AT - Central Excise

Natural justice - Classification of goods - Katha-II - classified under CTH 14049050 or 13021919 of CETA - Held that - initially the test report was given in favor of the appellants. Subsequently, the test report was amended. In that circumstances, in the interest of justice, the cross-examination of Chemical examiner was required to be done - it is gross violation of principle natural justice by not providing cross-examination of the Chemical examination - the matter is remanded back to the Adjudicating Authority to decide the issue on merits - appeal allowed by way of remand.

Summary

Issues:
Classification of product Katha-II under Chapter Heading 1302 of Central Excise Tariff Act, 1985. Denial of cross-examination of Chemical examiner. Violation of principles of natural justice.

Analysis:
The appellants contested the classification of their product Katha-II under Chapter Heading 1302 of the Central Excise Tariff Act, 1985. Initially, the Chemical examiner's report favored the appellants, confirming the product as Katha. However, the report was later amended, stating that the sample did not conform to Katha standards as per IS 4359-1967. The appellants argued that denial of cross-examination of the Chemical examiner was unjust, especially when cross-examination was allowed for another assessee in a similar case. They cited a previous Tribunal decision to support their claim. On the contrary, the Revenue supported the impugned order, emphasizing that the test results did not align with Katha standards. After hearing both parties, the Tribunal found that the lack of cross-examination of the Chemical examiner was a violation of natural justice. Citing a decision of the Hon'ble Punjab & Haryana High Court, the Tribunal set aside the impugned order and remanded the matter to the Adjudicating Authority for a decision on merits. The Authority was instructed to allow cross-examination of the Chemical examiner and consider the manufacturing process in light of judicial pronouncements.

In conclusion, the appeal was disposed of by way of remand, emphasizing the importance of adhering to principles of natural justice and allowing cross-examination for a fair decision-making process.