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TMI Blog2017 (11) TMI 1120X X X X Extracts X X X X X X X X Extracts X X X X ..... ter and hence, all such certificates were not valid but only an empty formality. Cross-examination - the appellant has sought cross-examination of the veterinary doctors whose certificates where recovered during such proceedings - Held that: - cross-examination has not been allowed by the adjudicating authority before passing the impugned order. We note that it is a well settled legal principle that the cross examination of witnesses whose statements are admitted as evidence has to be considered in terms of Section 138B of the Customs Act. The said provisions are identical to the provisions of Section 9D of the Central Excise Act, 1944 - cross-examination of the above witnesses will be particularly necessary since the case of revenue is based on the certificates said to have been issued by these doctors. The matter is required to be remanded to the adjudicating authority to pass fresh orders after allowing the cross-examination of the witnesses - appeal allowed by way of remand. - C/3017-3022/2012-CU[DB] - C/A/57415-57420 /2017-CU[DB] - Dated:- 27-10-2017 - Mr. (Dr.) Satish Chandra, President And Mr. V. Padmanabhan, Technical Member Present Shri V. Lakshmikumaran S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1-CESTAT-DEL-CU wherein para 9 it was mentioned that- 9. .......We find force in the claim of the main appellants that the legal provision regarding the demand of duty from the person who is the beneficiary of the instrument issued by the authorities under Foreign Trade (Development and Regulation) Act, 1992 has been introduced only w.e.f. 28.05.2012, as Section 28AAA in the Customs Act, 1962. Introduction of such provision in the substantive law itself makes it clear that there is no legal sanction prior to that date to hold the person to whom, the instrument was issued as a person liable to Customs duty. 6. It is the submission of the ld. Counsel that in the instant case the demand was raised prior to the period 2010. The demand is not leviable on the exporter of meat. To support his argument, he relied upon the ratio laid down in the case of CC (E.P.) Vs. Jupiter Exports 2007 (213) ELT 641 (Bom.) wherein it was observed that- 23. With regard to the third question of law, namely, whether the license holder or the transferee of the license obtained by manipulation and forging the documents for creating false records are entitled to import validly and legall ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t under Section 75 of Customs Act, 1962 and Section 37 of the Central Excise Rules, for demand of erroneously paid drawback on export or for recovery of drawback paid which the exporter has to pay back as the sales proceeds have not been realised within the period stipulated in Foreign Exchange Management Act and Section 75A(2) for demand of interest on wrongly paid drawback for the period of delay in its payback, there are no other recovery provision in the Customs Act, 1962 . 8. To conclude his arguments, ld. Counsel submits that the department is also in dilemma whether the duty imposed can be demanded from the importer as mentioned in para 74 of the impugned order. Lastly, he submits that Section 28 of the Customs Act, 1962 is not applicable in the instant case. Hence, demand is illegal and the same may be set aside. 9. On the other hand, Shri Govind Dixit, ld. AR for the Revenue supported the impugned order. He submitted that in the instant case, show cause notice was issued on 30.05.2011 with a corrigendum dated 09.09.2011. The ratio laid down in the case of The Thar Dry Port (supra) is not applicable for the reason that in that case the notice was issued much late ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o columns were blank but other details such as the Veterinary Doctor, owner, date of production, batch number etc. For this purpose he read out para 151. 12. We have heard both the parties and perused the record. 13. At the outset we take up discussion of the legal argument that Customs Authorities are not entitled to invoke the provisions of section 28 of the Customs Act for issuing a demand for repayment of the DEPB credit. In the present case, the appellant has exported chilled meat and procured DEPB/VKGUY scrips issued by DGFT. The allegations made in the SCN by customs Department are that such scripts where procured by undertaking export of chilled meat in contravention of the relevant provisions of the Foreign Trade Policy (FTP). It is the argument of the Ld. counsel for the appellant that Section 28AAA came into effect w.e.f. 28.05.2012 empowering the Customs Department to recover the duty relatable to the utilization of an instrument (Such as DEPB scrips) which has been procured by means of collusion, willful mis-statement or suppression of facts from the person to whom such instrument has been issued even if the import under the instrument has been made by another pe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... when any duty has not been levied, or has been short levied, the proper officer may serve a notice on the person chargeable with the said duty requiring him to show cause why he should not pay the amount specified in the notice. Section 28(1-A) relates to levy of interest under Section 28AB and levy of penalty equal to 25%. DEPB scrips are Customs duty exemption benefits in as much as they are utilized for import of goods and, to the extent of credit available in the DEPB scrips, goods can be imported without payment of import duty on such goods. As Customs duty was not paid, to the extent of credit available in DEPB scrips issued on the basis of fraudulent over-invoicing of export goods, the Customs Officer is entitled, under Section 28(1) of the Customs Act, to demand payment thereof. As the DEPB scrips have, admittedly, been sold to third parties, the only course open to the Customs Officers is to demand repayment of DEPB credit (i.e., Customs (Import) duty) from the petitioner. Exercise of power to make such a demand is referable to Section 28(1) of the Customs Act. The impugned show cause notices, which propose a demand for repayment of DEPB credit under Section 28(1) as it wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uthority), for contravention of the provisions of Act 22 of 1992 or the rules made thereunder, a similar power of confiscation is available under Section 113(i) of the Customs Act also. The mere fact that Section 11 of Act 22 of 1992 empowers the DGFT to confiscate the goods or impose penalty would not, in view of Section 12 of Act 22 of 1992, denude Customs officers of the powers of confiscation under Section 113(i) of the Customs Act or to demand, under Section 28 of the Customs Act, repayment of the Customs duty benefits extended earlier to the petitioner on the erroneous premise that the fraudulently over-invoiced goods represented the true value of exports made by them. 19. The Hon ble Andhra Pradesh High Court has held that the Customs Authorities had the power to issue show cause notice under section 28 for repayment of credit which was availed by resort to fraud. The Hon ble High Court has taken the view that though DEPB scripts are issued by DGFT, the relevant notifications are for customs duty exemption notification. The Hon ble High Court has further held that the power to exempt would include within its ambit the power to demand in the event such exemption is misu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sue such certificates during the relevant period. Specifically they have sought the cross-examination of Dr. Jeevan Singh, Animal Husbandry Dept, UP and Dr. Abdul Majid, Veterinary Officer, Talipur, Aligarh. 24. We find that cross-examination has not been allowed by the adjudicating authority before passing the impugned order. We note that it is a well settled legal principle that the cross examination of witnesses whose statements are admitted as evidence has to be considered in terms of Section 138B of the Customs Act. The said provisions are identical to the provisions of Section 9D of the Central Excise Act, 1944. In this connection reference can be made to the decision of Hon ble Bombay High Court in the case of Nirmal Seeds Ltd. - 2017-TIOL-627-HC (Mum-Cx) and the decision of Hon ble Punjab Haryana High Court in the case of G. Tech Industries - 2010(339)ELT 209 (P H). 25. We also consider that cross-examination of the above witnesses will be particularly necessary since the case of revenue is based on the certificates said to have been issued by these doctors. 26. In view of the above, we are of the view that the matter is required to be remanded to the ad ..... X X X X Extracts X X X X X X X X Extracts X X X X
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