2009 (8) TMI 581 - AT - Customs

Natural Justice- Documents not supplied and cross examination- Allegation of drawback and DEPB fraud and denial of such undue benefits based on foreign currency deposited in cash in bank in the name of foreign national. Charges serious in nature and same to be dealt with application of mind by adjudicating authority. Supply of relied upon documents and also non relied documents requested by the appellant and the same sought to have been given. Procedural difficulties in summoning foreign witness can be overcome to the extent possible. Natural Justice not deniable on the ground of procedural difficulties. Matter remanded to commissioner to pass fresh orders after supply of documents and allowing cross examination of foreign nationals at appellant s expense whose statement was relied upon.

Summary

Issues:
Adjudication of show-cause notices denying duty drawback and DEPB credit, imposition of penalties, confiscation of foreign currency, denial of natural justice, denial of cross-examination opportunity, procedural difficulties in summoning witnesses.

Analysis:
The Commissioner of Customs passed orders denying drawback of duty and DEPB credit to certain parties based on investigations revealing overinvoicing and claims based on sale proceeds not through normal banking channels. Penalties were imposed under the Customs Act, and foreign currency was confiscated. The main grievance raised was the denial of natural justice, alleging orders were passed without supplying necessary documents and not allowing cross-examination of foreign nationals whose statements were relied upon. Acknowledgments of document receipt were shown, but appellants claimed some documents were not supplied. The appellants requested the opportunity to cross-examine the foreign nationals and receive all relevant documents for a fair defense.

The Tribunal found serious charges against the appellants, including over invoicing and inadmissible benefits based on foreign currency deposits and upheld the denial of benefits. However, it noted the denial of natural justice in not supplying all relied-upon documents and not allowing cross-examination of key witnesses. The Tribunal emphasized the importance of providing all relevant documents for a fair defense and the right to cross-examine witnesses. It set aside the Commissioner's orders, remanding the case to allow document access, cross-examination of foreign nationals, a fair hearing, and a speaking order within six months.

In conclusion, the Tribunal addressed the denial of natural justice in a case involving denial of duty drawback, DEPB credit, penalties, and confiscation of foreign currency. While upholding certain charges, it emphasized the importance of providing all relevant documents and the opportunity to cross-examine witnesses for a fair adjudication process. The case was remanded for a fresh hearing with specific directions to ensure procedural fairness and timely resolution.