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TMI Blog2016 (4) TMI 622X X X X Extracts X X X X X X X X Extracts X X X X ..... the basis of records available during the course of adjudication and the same has not been considered judicially. In view of the above, the impugned order is set aside. The adjudicating authority shall be at liberty to re-adjudicate the matter after following the procedure laid down under section 9D of the Act - Appeal No. E/768/2011, Appeal Nos. E/55867,56023-56025/2014 - Final Order No. 50938-50942/2016 - Dated:- 4-3-2016 - Ashok Jindal, Member (J) And B. Ravichandran, Member (T) For the Appellant : Shri R K Mishra, AR Vice Versa For the Respondents : Shri C Harishankar S Sunil, Advs ORDER Per Ashok Jindal M/s. Kuber tobacco India Ltd. (for short M/s.Kuber), Shri Dhanpat Singhee, Director, Shri Chatar Singh Baid and Shri Vikas Malu (all called as appellants) are in appeals against the impugned order. The Revenue (respondent) has also filed appeal against the same impugned order. 2. The facts of the case are that an intelligence gathered indicated that M/s.Kuber is engaged in the activity of unaccounted manufacture of 'Kanchan/Kanchann' brand gutka and 'wiz' brand pan masala by clandestinely installing and operating FFS machines ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nchann' brand gutka and 'wiz' brand pan masala manufactured at the premises of Sandeep Poultry Farm alleging that gutkhas were cleared clandestinely during the period August, 2008 to November, 2008. It is submitted that M/s.Kuber has categorically denied having anything to do with the activity at Sandeep Poultry Farm. It was also submitted that the said activities were illicit amounting to mis-use of brand name and goodwill of the appellant by certain elements who were manufacturing duplicate goods bearing M/s.Kuber brand names and clearing them in the market. It was also submitted that the whole affair was the result of conspiracy between Dhanpat Singhee, its ex-director in collusion with Shri Om Prakash Dubey, the tenant of Sandeep Poultry Farm, and Rajesh Kumar Dubey and Manoj Triparthi and others and it was also submitted that the names of S/Shri Moolchand Malu, Vikas and C.S.Baid have been unnecessarily been dragged in the controversy whereas they had nothing to do with M/s.Kuber and were neither directors nor shareholders during the impugned period. In these set of facts, it is submitted that the Revenue has relied on the various statements recorded during the cou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and in the case of State of UP.vs. Singhara Singh, AIR 1964 SC 358. He further submitted that there is no admissible evidence on record to link the assessee to the activities at the premises of Sandeep Poultry Farm. Therefore, he prayed the impugned order is to be set aside. 5. With regard to the appeal filed by the Revenue, he relied on the same argument as discussed hereinabove. 6. On the other hand, learned AR opposed the contention of the learned Counsel for the appellant and submitted that in this case the statements relied upon during the course of investigation are admissible evidence. Moreover, in this case, the appellants were granted the cross examination of witnesses, therefore, the statements recorded during the course of investigation are reliable evidence. He further, submitted that as the appellants themselves come forward and made voluntary deposition, therefore, the appellant cannot run away from their liability in view of the decision of the apex court in the case of Kalvert Foods India Pvt.Ltd.-2011 (270) ELT 643 (SC). He also relied upon the decision in the case of Vinod Solank-2009 (233) ELT 157 (SC), He further submitted that the learned counsel has heav ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd the Court is of the opinion that, having regard to the circumstances of the case, the statement should be admitted in evidence in the interests of justice. (2) The provisions of sub-section (1) shall, so far as may be, apply in relation to any proceedings under this Act, other than a proceeding before a Court, as they apply in relation to a proceeding before a Court, 8. The main contention of the appellant is that the deponents whose statements have been relied upon by the adjudicating authority were not put to examination-in-chief before providing an opportunity of cross examination. A plain reading of sub-section (1) of section 9D makes it clear that clauses (a) and (b) of the said sub-section set out the circumstances in which a statement, made and signed by a person before the Central Excise Officer of a gazette rank, during the course of inquiry or proceeding under the Act, shall be relevant, for the purpose of proving the truth of the facts contained therein. Therefore, there is no doubt about the legal position that the procedure prescribed in sub-section (1) of section 9D is required to be scrupulously followed, as much as in adjudication proceedings as in crim ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has to first be examined as a witness in the case before the adjudicating authority, and (ii) the adjudicating authority has, thereafter, to form the opinion that, having regard to the circumstances of the case, the statement should be admitted in evidence in the interest of justice. The same view has been taken by hon'ble Allahabad High Court in the case of Parmarth Iron Pvt.Ltd. (supra) wherein the High Court has observed as under:- 16. We, therefore, have no hesitation in holding, that there is no requirement in the Act or Rules, nor do the principles of natural justice and fair play require that the witnesses whose statements were recorded and relied upon to issue the show cause notice, are liable to be examined at that stage. If the Revenue choose not to examine any witnesses in adjudication, their statements cannot be considered as evidence. However, if the Revenue choose to rely on the statements, then in that event, the persons whose statements are relied upon have to be made available for cross-examination for the evidence or statement to be considered. 10. We further find that in the case of Smt.Sharadamma (supra), hon'ble Karnataka High Court has observed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ept out of the way by the adverse party; and (e) when his presence cannot be obtained without an amount of delay or expense, which the Officer considers unreasonable. These circumstances show that if witness cannot be examined for any of these five reasons, the statement previously recorded would be relevant. The adjudicating authority was therefore bound to follow the binding precedent and in absence of any specified circumstance to consider the statement relevant without examining the witnesses, erred in rejecting the request of the appellant to examine the witnesses and to offer them for cross-examination. 8. The appellant has also relied on the judgment of Hon'ble Apex Court in Sukhwant Singh v. State of Punjab, (1995) 3 SCC 367 to give emphasis on his submission that examination of witness is mandatory unless specified exceptional circumstances mentioned in clause (a) of Section 138B(1) exist. The Hon'ble Apex Court was pleased to hold that - 8. It will be pertinent at this stage to refer to Section 138 of the Evidence Act which provides: 138. Order of examinations. - Witnesses shall be first examined-in-chief then (if the adverse party so desir ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion 138 (supra) envisages that a witness would first be examined-in-chief and then subjected to cross-examination and for seeking any clarification, the witness may be re-examined by prosecution. There is, in our opinion, no meaning in tendering a witness for cross-examination only. Tendering of a witness for cross-examination, as a matter of fact, amounts to giving up of the witness by prosecution as it does not choose to examine him in chief. However, the practice of tendering witness for cross-examination in session trials had been frequently resorted to since the enactment of the code of Criminal Procedure, 1898. 14. In view of the above anaylsis, it is clear that during adjudication, the adjudicating authority is required to first examine the witness in chief and also to form an opinion that having regard to the facts and circumstances of the case, the statements of the witness are admissible in evidence. Thereafter, the witness is offered to be cross examined. In the absence of examination in chief, allowing the cross examination, is a futile exercise. We further find that the appellant have challenged the impugned order on the ground that the evidence in the form of stat ..... X X X X Extracts X X X X X X X X Extracts X X X X
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