2018 (2) TMI 623 - AT - Central Excise

Clandestine removal - opportunity to cross-examination - principles of Natural Justice - Held that - the statements which are used against the appellants are required to be subjected to cross-examination before confirming the demand of clandestine removal based on those statements - appeal allowed by way of remand.

Summary

Issues:
- Allegation of clandestine manufacture and clearance of M.S. Angles, M.S. Channels without duty payment
- Denial of cross-examination of witnesses
- Violation of principles of natural justice
- Ex-parte order by Ld. Commissioner (Appeals)

Analysis:
1. Allegation of Clandestine Manufacture and Clearance: The case involved the appellants being accused of clandestine manufacture and clearance of M.S. Angles, M.S. Channels without paying duty amounting to ?6,74,444. The adjudicating authority relied on statements recorded during the investigation to confirm the demand. The appellants requested to cross-examine the witnesses whose statements were used against them, but the opportunity was denied. The Tribunal noted the importance of allowing cross-examination before confirming demands based on such statements, citing legal precedents. Consequently, the impugned order was set aside, and the appeals were remanded for cross-examination of witnesses and a fair hearing.

2. Denial of Cross-Examination: The appellants argued that the denial of the opportunity to cross-examine witnesses violated the principles of natural justice. They contended that the statements of various individuals were relied upon without granting them the chance to question the witnesses. The Tribunal agreed with this contention, emphasizing the necessity of cross-examination in such situations. The failure to allow cross-examination was deemed a violation of natural justice, leading to the decision to remand the case for the appellants to exercise their right to cross-examine the witnesses.

3. Ex-Parte Order by Ld. Commissioner (Appeals): It was acknowledged that the order passed by the Ld. Commissioner (Appeals) was ex-parte, indicating that the case was decided without affording a reasonable opportunity of hearing to the appellants. The Tribunal recognized this procedural flaw and directed that the appeals be remanded to the adjudicating authority for a fresh hearing, ensuring that the appellants are provided with a fair opportunity to present their case. By setting aside the ex-parte order, the Tribunal upheld the importance of due process and fair treatment in legal proceedings.

In conclusion, the judgment by the Appellate Tribunal CESTAT AHMEDABAD addressed the issues of clandestine manufacture, denial of cross-examination, violation of natural justice, and an ex-parte order. The decision emphasized the significance of allowing cross-examination of witnesses, ensuring fairness and adherence to principles of natural justice in legal proceedings. The case was remanded for a fresh hearing, underscoring the importance of providing parties with a fair opportunity to present their arguments and challenge the evidence against them.