2013 (8) TMI 850 - AT - Customs

Benefit of Notification No. 21/2002 Opportunity to Cross Examination - Assesse imported Crude Palm Oil at concessional rate of duty in terms of Notification No. 21/2002-Cus - Held that - - the assesse should be given an opportunity to cross examine - The cross examination and the important witnesses of the Revenue should have been extended by the Adjudicating Authority - reasons adopted by the Adjudicating Authority for denial of cross examination were neither legal nor convincing - After the conclusion of the cross examination the assesse would file the reply to the notice within a period of 15 days therefrom and after affording an opportunity of personal hearing, the Commissioner would pass the order as soon as possible - the entire case of the Revenue was mainly based upon the records of assesse and the statement as regards the non-sale of the Caustic Soda, one of the main raw materials, to be used in the manufacture of laundry soap along with Crude Palm Oil Decided in favor of assesse.

Summary

Issues:
Violation of principles of natural justice in passing the impugned order.

Analysis:
The case involved the import of Crude Palm Oil by M/s. Bhagwan Vanaspati Mills at a concessional rate of duty for manufacturing laundry soap as per Notification No. 21/2002-Cus. The Customs rules required registration, application, bond execution, and maintenance of records, including an end-use certificate. The Revenue alleged that invoices for caustic soda, a key raw material, were fake, indicating the imported oil was sold. The Revenue's case relied on records from M/s. Mega Sales and a statement by its Director, contradicting M/s. Bhagwan Vanaspati's claims. The appellant argued they followed procedures, and the Revenue's case was solely based on the Director's statement without allowing cross-examination.

The Adjudicating Authority denied cross-examination, citing other evidence and lack of document submission by the appellant. However, the denial reasons were deemed inadequate as the evidence from dealers' cash purchases supported the appellant's position. The appellant's failure to submit documents did not justify denial of cross-examination. The Authority's view that the request was a delay tactic was criticized as the right to cross-examine a crucial witness should be allowed. The Revenue's case heavily relied on M/s. Mega Sales' records and the Director's statement, necessitating cross-examination for fairness. The Tribunal ordered cross-examination of the Director, followed by the appellant's reply and a prompt decision by the Commissioner to ensure justice and procedural compliance.

In conclusion, the Tribunal found the impugned order violated principles of natural justice due to the denial of cross-examination crucial to the case. The case highlighted the importance of fair procedures and the right to challenge evidence for a just outcome.