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TMI Blog2015 (9) TMI 343X X X X Extracts X X X X X X X X Extracts X X X X ..... – Instead, Tribunal makes reference to general principle that retraction of statement and cross-examination of certain persons would not make any dent in plethora of evidence produced by Department and confessions of various persons – Therefore, further finding that case cannot be demolished merely by cross-examination of witnesses by ignoring circumstances and corroborative evidence is equally vitiated because crossexamination may contain admissions – Thus, Tribunal's conclusions cannot be sustained and are vitiated by errors of law apparent on face of record – Tribunal's order deserves to be quashed and set aside – Decided in favour of appellant. - Customs Appeal No. 97 of 2014, Customs Appeal No. 57 of 2015 - - - Dated:- 8-6-2015 - S.C. Dharmadhikari G.S. Kulkarni, JJ. For the Petitioner : Mr. V. Sridharan, senior counsel with Mr. Prakash Shah, Mr. Jaideep C. Patel and Mr. Jas Sanghvi i/b PDS Legal For the Respondent : Mr. Pradeep S. Jetly ORAL JUDGMENT : [Per S.C. Dharmadhikari, J.] 1. These two appeals by Kiran Nagindas Vora and Iqbal Mohan Amritlal Mehra challenge a common order passed by the Customs, Excise and Service Tax Appellate Tribunal, Benc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eva Customs House and claiming duty drawback by inflating its value and that is how search was carried out in the premises of the customs house agents, documents were seized, panchanamas were drawn and statements of various persons recorded. Even the statements of some of the persons, including the appellant, came to be retracted. Reliance is placed upon an affidavit dated 28th September, 1999 in that regard. There was a further statement recorded of the appellant by the said DRI on 30th August, 2000, where the appellant referred to his past dealings and business. There was also a letter sent by the appellant on 14th February, 2001, informing both the DRI and the Excise Department that he had retracted the statements. The Enforcement Directorate allegedly forced the appellant to give statements and which came to be at the behest of the officials exercising powers under the Foreign Exchange Regulation Act and Foreign Exchange Management Act. The appellant was arrested and produced in Court on 26th February, 2001, on which date he specifically retracted the statements made on 24th and 25th February, 2001. It is alleged that when the appellant was in Nashik Central prison, the DRI rec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... judicating Authority heard all parties and passed an order styled as order-in-original dated 11th May, 2009. The Adjudicating Authority on this occasion held that the appellant's acts have not resulted in the wrongful availment of drawback and, therefore, the charges levelled against him were liable to be dropped. The Adjudicating Authority thus dropped the proceedings against the appellant. 8. Thereafter, the matter was taken up for review by the Special Committee of Chief Commissioners and it decided to approach the Tribunal. There are certain other proceedings referred to, including a Public Interest Litigation instituted in this Court and the replies filed therein by the Enforcement Directorate but what is material for us is that the Tribunal in this second round allowed the Revenue appeals and imposed a penalty of ₹ 15 lakhs on the appellant. The Tribunal concluded that both the appellant and Shri Mehra have colluded with others and created front companies and allowed them to avail of these drawbacks. Therefore, penalties can be imposed upon them. 9. It is this order of the Tribunal which is challenged in this appeal. 10. Mr. Sridharan, learned senior counse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e other hand would submit that this appeal is nothing but an attempt at re-appreciation and reappraisal of the factual material on record. The Tribunal, however, has assigned cogent and satisfactory reasons for reversing the order of the Adjudicating Authority. Mr. Jetly submits that these are nothing but delaying tactics. The matter has been remitted back and on remand the appellant succeeded before the Commissioner. It is the Revenue which pointed out to the Tribunal that the retraction of statements will not in any manner assist parties like the appellant. The cross-examination of certain persons and read as a whole would reveal that both M/s. Radheshyam Exports Pvt. Ltd. and M/s. Specialist Exports did not receive any payment through the companies against whose letter of credit the exports were made. Thus, there was nothing to show that the export realisation was from genuine exports. The amounts by way of export remittance were received in cash. The drawback was transferred by M/s. Radheshyam Exports Pvt. Ltd. to the bank account of M/s. Specialist Exports, M/s. Noble Garments and M/s. Sun Apparels. Similarly, the drawback received by M/s. Specialist Exports was transferred to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en all the materials were placed by both sides, he had not only the statements which were later on retracted but the response or replies of other noticees. We are rather surprised that the Adjudicating Authority and equally the Tribunal follows in all such cases as a routine, a pattern. The pattern being those noticees who were called upon to show cause filed their response and replies in writing. They rely upon certain documents which may be also relied by the Revenue and emanating from the Revenue's record. The Tribunal as also the Adjudicating Authority in this case has proceeded on the footing that there is no denial of the existence of the documents or their contents. There is no dispute raised in that regard. Therefore, the Tribunal has permitted cross-examination of the noticees either by the department or by the co-noticees. We are mindful of the fact that in adjudication or such proceedings, strict rules of evidence or the law of evidence may not be applicable. However, what the principles of natural justice demand is that what is in evidence cannot be relied upon. What is evidence is something about which a party has given a writing in the form of an affidavit. Furthe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g with additional interim reply and he sent a registered AD letter to the DRI with his affidavit dated 14th February, 2001, which gave full particulars of his business activities, including Russian exports. He made a specific statement therein that the DRI and his officials coerced him to write a statement inculpating him. This affidavit, though received by the DRI, has not been rebutted. 17. Then, the Commissioner holds that the statements of Vora recorded at the Central Prison cannot take the case any further because the earlier statements have been specifically retracted. The retraction has not been termed as an after-thought nor it has been observed that the same is not honest and truthful. Apart therefrom and if any finding can be based on such retracted confession, the Commissioner found no independent corroborative material. He holds that even the conoticees have not inculpated or involved Kiran Nagindas Vora. He referred to a cross-examination of one Sandeep Naik, Director of M/s. Radheshyam Exports Pvt. Ltd. recorded on 5th December, 2005, wherein he states that Kiran Vora was not involved in any activity of M/s. Radheshyam Exports Pvt. Ltd. Thus, when at the relevant t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thout any merit. However, it was the duty of the Tribunal to have referred to the specific allegations against the appellant allegedly floating fictitious companies and enabling them to avail of duty drawback benefit. Therefore, the duty of the Tribunal was to deal with specific allegations against the appellant, the response and the evidence in relation thereto. Based on the general evidence and against other appellants it could not be established before the Tribunal that the Commissioner has erred in taking a view that no penalties can be imposed on the said Vora. The Tribunal's conclusion that in case of retraction of confessional statement can be ignored might be correct as a general statement of law but that inculpatory portion of retracted confession must be relied upon together with independent corroborative material. The same only cannot be then relied upon and to base any conclusion. Therefore, its further finding that a case cannot be demolished merely by cross-examination of witnesses by ignoring circumstances and corroborative evidence is equally vitiated because the crossexamination may contain admissions. The cross-examination may also have vital omissions and inc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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