2018 (7) TMI 194 - HC - Customs

Principles of natural justice - denial of opportunity of cross-examination - classification of goods - Held that - The request made for cross examination has been rejected by the authority, not once, but twice. The rejections have been by speaking orders. More importantly all the officers have discharged their official function and the department has specifically stated that they have not recorded any statement from the officers so as to make them available for cross examination, as if they have rendered a personal opinion in the matter - the officers having discharged their official duty, that too, based upon the documents which were filed by the importer cannot be subjected to cross examination at the instance of the importer. At best, the importer can place materials before the Adjudicating Authority to establish that the assessment done was improper or incorrect. Whether the petitioner should be permitted to bye-pass such a remedy and whether the Court should exercise discretion in the matter? - Held that - The issue which is in dispute in the current proceedings pertain to classification of the goods which have been imported to arrive at the rate of duty payable. This undoubtedly is a factual issue which cannot be adjudicated in a Writ Petition - petition not maintainable. Petition dismissed as not maintainable.

Summary

Issues:
Challenge to order reclassifying goods in Bills of Entry and imposition of penalty; Denial of opportunity for cross-examination of departmental officers; Jurisdiction of the author of the show cause notice; Relevance of self-assessment procedure in Customs Act; Interpretation of principles of natural justice; Adjudication of factual issues in a Writ Petition; Applicability of appellate remedy before CESTAT.

Analysis:
The petitioner challenged an order reclassifying goods in Bills of Entry and imposing penalties, alleging violation of natural justice principles due to denial of cross-examination of departmental officers. The petitioner argued that pre-2011, all entries were assessed by customs officers, and post-2011, they followed the same classification benefiting from concessional duty rates. The petitioner sought cross-examination based on the officers' assessments. Reference was made to legal precedents regarding the proper officer for duty demands and the right to cross-examine. The petitioner contended that denial of cross-examination violated natural justice principles and departmental inconsistency. The petitioner requested the court to allow cross-examination of officers.

The respondent defended the denial of cross-examination, stating that officers acted based on documents provided by the importer, not personal opinions, and no statements were recorded from them. The respondent highlighted multiple opportunities given for personal hearings, lack of response from the petitioner, and the distinction of the petitioner's case from legal precedents cited. The respondent emphasized compliance with legal provisions on personal hearings and rejected the petitioner's repeated requests for cross-examination. The respondent maintained that the officers' official functions did not warrant cross-examination by the importer.

The court upheld the authority's rejection of cross-examination requests, noting that officers acted officially based on documents, not personal opinions. The court found the petitioner's request for cross-examination unreasonable, emphasizing that the importer could challenge assessments before the Adjudicating Authority. The court clarified that the decision was preliminary, and the petitioner had the option to appeal to CESTAT. The court deemed the issue of goods classification a factual matter unsuitable for a Writ Petition, directing the petitioner to pursue appellate remedies. Ultimately, the court dismissed the Writ Petition as not maintainable, allowing the petitioner to appeal before the Tribunal without rendering any judgment on the case's merits.

In conclusion, the judgment addressed the denial of cross-examination, the jurisdiction of the show cause notice author, and the petitioner's right to challenge assessments through appellate remedies. The court emphasized the distinction between factual issues and legal proceedings, guiding the petitioner to pursue the appropriate appellate route for resolving classification disputes, thereby dismissing the Writ Petition without delving into the case's merits.