2014 (4) TMI 7 - AT - Central Excise

Duty demand - Non cross examination of parties - Held that - appellants had made a specific request for cross examination of all these persons in his reply to the show cause notice and there is no whisper in the said order dealing with the appellant s request. We note that inasmuch as the Revenue s entire case is primarily based upon the statement of Shri Roshan Lal and his son Pawan Kumar, it was obligatory on the part of the adjudicating authority to tender these persons for cross examination so as to test the veracity of the correctness of their statement, especially when said two persons have been changing their stand. The statement of said two persons is different when they are before the authorities and subsequent retraction when they are free and away from the officers. In these circumstances, it was required that these persons were tendered for cross examination. As such, we set aside the impugned order and remand the matter to original adjudicating authority to re-adjudicate the issue after allowing cross examination of Shri Roshan Lal as also of Shri Pawan Kumar. Appellant is free to make a request for cross examination of other persons, whose statements are being relied upon by the revenue in support of their case - Decided in favour of assessee.

Summary

Issues:
Duty confirmation based on statement of a dealer regarding procurement of raw materials for manufacturing Tobacco Snuff by another company.

Analysis:
The judgment revolves around the duty confirmation against a company engaged in the manufacture of Tobacco Snuff, primarily relying on the statement of a dealer regarding the procurement of raw materials. The appellant contested the duty confirmation, arguing that the supplier of Tobacco confirmed supplying to the dealer only, not directly to the appellant. The Revenue's stance was challenged as being based on assumptions and presumptions, lacking concrete evidence to support the claim.

The statement of the dealer, crucial to the Revenue's case, was later retracted and deemed unreliable due to alleged pressure from the Revenue. Despite the appellant's request for cross-examination of various individuals involved, including the dealer and other witnesses, the adjudicating authority failed to consider this request. The Tribunal emphasized the importance of cross-examination to test the veracity of statements, especially when inconsistencies arise, as seen in this case.

Consequently, the Tribunal set aside the impugned order and remanded the matter to the original adjudicating authority for re-adjudication after allowing the cross-examination of the dealer and other relevant persons. The judgment clarified that it did not express any opinion on the case's merits but focused on upholding the principles of natural justice. The adjudicating authority was granted the discretion to reevaluate the case based on the outcomes of the cross-examination process, ensuring fairness and due process.

In conclusion, all stay petitions and appeals were disposed of in light of the decision to remand the matter for re-adjudication, highlighting the significance of procedural fairness and the right to cross-examination in legal proceedings.