2019 (4) TMI 340 - AT - Customs

Principles of natural justice - relevancy of statements that are not tested in cross-examination - acquittal of the appellant in proceedings under section 135 of Customs Act, 1962 - Held that - It would appear that the evidence against the appellant on his alleged involvement with the ineligible availment are the forensic reports and his admitted association with the assessment of the shipping bill. The principles of natural justice mandate that, in the absence of corroborative evidence, oral/written deposition should be subjected to test for attaining credibility. It is the right of an accused, especially in the context of reliance on opinions of expert, to be granted an opportunity to discredit an allegation by confronting the expert whose opinion is peremptory and without any reasoning. That is possible only upon being offered cross-examination and being furnished with documents. The foundation for the upholding of the allegations has not been properly laid. The structure built on such weak foundation does not survive. Matter remanded back to the original authority for compliance with principles of natural justice and due consideration of the submissions made by the appellant before that authority - appeal allowed by way of remand.

Summary

Issues involved:
- Alleged violation of principles of natural justice in imposing penalty under Customs Act, 1962
- Allegations of tampering with shipping bills and obtaining benefits under DEPB Scheme
- Reliance on expert opinions and forensic reports as evidence
- Cross-examination rights of the accused in the context of expert opinions
- Judicial interpretation of the distinction between statements and expert opinions

Detailed Analysis:
1. The appeal concerns the imposition of a penalty on an officer under the Customs Act, 1962, alleging non-adherence to principles of natural justice by the adjudicating authority. The appellant contests the penalty, arguing that the penal provision should only apply if there is evidence of acts or omissions related to the exported goods. The appellant questions the reliance on forensic reports and expert opinions without proper analysis leading to conclusions. Additionally, the denial of cross-examination rights and lack of corroborative evidence are highlighted as violations of natural justice principles.

2. The learned counsel for the appellant emphasizes that the allegations are based on forensic reports and the appellant's association with the assessment of shipping bills. The Tribunal's decision in a similar case underscores the importance of distinguishing between statements and expert opinions. The absence of corroborative evidence and the reliance solely on expert opinions without proper foundation are key points raised in defense against the penalty.

3. The authorized representative argues that the adjudicating authority thoroughly examined the issues, confirming the alteration of shipping bills that facilitated misuse of the DEPB Scheme. However, the defense maintains that in the absence of substantial corroborative evidence, oral/written depositions should undergo scrutiny for credibility. The remand of the matter back to the original authority is sought for ensuring compliance with natural justice principles and considering the appellant's submissions.

4. The judgment emphasizes the accused's right to challenge allegations based on expert opinions through cross-examination and access to relevant documents. The foundation of allegations, primarily relying on expert opinions, is deemed weak and insufficient to sustain the penalty. The need for proper adherence to natural justice principles and due consideration of the appellant's arguments before the original authority is stressed for a fair resolution of the case.

In conclusion, the judgment highlights the significance of procedural fairness, scrutiny of evidence, and the distinction between statements and expert opinions in adjudicating penalties under the Customs Act, 1962. The remand of the case underscores the importance of upholding principles of natural justice and ensuring a comprehensive evaluation of the appellant's defense in penalty proceedings.