2018 (1) TMI 965 - AT - Customs

Smuggling - illegal exports to Nepal - Urad Ki Dal - opportunity of cross-examination - Held that - If the appellant is disputing the factual positions and if the various deponents statements have retracted from their earlier statements, such cross-examination is required to test the veracity of their statements as also to establish the factual position. Such cross-examination was necessary, especially in view of the fact that the Adjudicating Authority himself found incorrectness of the statement of Shri Kamlesh Gupta - The Hon ble Supreme Court in the case of Arya Abhushan Bhandar Versus Union of India 2002 (3) TMI 54 - SUPREME COURT OF INDIA , has observed that non-production of such witnesses for cross-examination results in breach of natural justice - matter remanded to the Lower Authorities for afresh decision, after affording the cross-examination of the witnesses In as much as, the Adjudicating Authority has not provided the cross-examination, the impugned order is in violation of the principles of natural justice and is required to be set aside on the said ground itself. Separate penalty on Shri Rahul Mishra - Held that - The charges of collusion against the said appellant are not substantiated by any evidence - As such in the absence of any evidence to the contrary, there is no justifiable reason to impose penalty on the said appellant. Appeal allowed in part and part matter on remand.

Summary

Issues involved:
1. Confiscation of "Urad Ki Dal" for illegal exports to Nepal.
2. Confiscation of trucks loaded with the Dal.
3. Imposition of penalties under the Customs Act, 1962.
4. Request for cross-examination of witnesses.
5. Violation of principles of natural justice.
6. Imposition of penalty on the supplier of the Dal.
7. Appeal for release of confiscated trucks pending denovo-adjudication.

Detailed Analysis:
1. The judgment addresses the confiscation of "Urad Ki Dal" intended for illegal exports to Nepal. The impugned order by the Commissioner of Customs led to the confiscation of the Dal valued at ?14.20 Lakhs, with redemption fines imposed on the appellants. Additionally, penalties were imposed on various individuals involved in the transaction under Section 114 of the Customs Act, 1962.

2. The judgment also involves the confiscation of two trucks loaded with the Dal, belonging to specific individuals, with redemption fines imposed on them as well. The trucks were intercepted near the Indo-Nepal Border, leading to further investigations and statements recorded from involved parties, including the drivers.

3. Penalties were imposed on different individuals, such as the owner of the Dal, the supplier, and the truck driver, as per the provisions of the Customs Act, 1962. The penalties varied in amount and were justified based on their roles in the illegal export activity.

4. The appellants requested cross-examination of witnesses to establish the factual position accurately. However, the Commissioner rejected the request, leading to a dispute regarding the necessity of cross-examination to test the veracity of statements and establish the factual position accurately.

5. The judgment highlights a violation of the principles of natural justice due to the denial of cross-examination, as emphasized by legal precedents from various high courts and the Supreme Court. The failure to provide cross-examination led to the setting aside of the impugned order and a remand for a fresh decision with the opportunity for cross-examination.

6. A separate penalty was imposed on the supplier of the Dal, which was contested based on the lack of substantial evidence proving his involvement in the illegal export activity. The judgment emphasized the absence of evidence supporting the collusion charges against the supplier, leading to the allowance of his appeal and remand of the other three appellants.

7. Lastly, an appeal was made for the release of the confiscated trucks pending denovo-adjudication, highlighting the financial burden on the truck owners and the impact of confiscation on their business. The judgment granted liberty to approach the Commissioner for provisional release of the trucks during the remand proceedings to prevent further delays.