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TMI Blog2022 (7) TMI 371X X X X Extracts X X X X X X X X Extracts X X X X ..... he adjudicating authority finds the evidence of the witness admissible , then such witness should be offered for cross-examination and only thereafter the evidence is admissible. In absence of compliance of the provision of Section138B of the Act, the statements are not admissible as evidence. The rejection of cross-examination in the impugned matter tantamount to violation of principles of natural justice. Request for cross-examination has been denied and the witnesses have not been examined despite specific reliance by the appellant on Section138B. The Hon ble Madras High Court in the case of M/S VEETRAG ENTERPRISES, CHETAN KUMAR RANKA, NIRMAL KUMAR LUNKAD VERSUS THE COMMISSIONER OF CUSTOMS (SEAPORT EXPORTS) [ 2015 (8) TMI 781 - MADRAS HIGH COURT ] has observed that attitude of the respondent shows that the petitioner was not given fair opportunity to defend their case, therefore, not providing an opportunity to cross-examine the above said eight witnesses, in my view, would violate the principles of natural justice. Accordingly, the impugned order is set aside and the respondent is directed to permit the petitioner to cross-examine the above said eight witnesses and pass a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Representative) for the Respondent ORDER The present appeals are directed against the impugned order-In-Appeal No. MUN-CUSTM-000-APP-75 to 78 dated 30.06.201 passed by the Commissioner of Customs (Appeals), Ahmedabad. 2. Briefly, the facts of the present case are that the appellant M/s Janki Dass Rice Mills had exported Rice under disputed Shipping Bills which were originally booked for Iran, but investigation revealed that the consignments were delivered to UAE and hence violated the provisions of para 2.40 and 2.53 of Foreign Trade Policy. Accordingly, show cause notice dtd. 14.02.2019 was issued and after due process of law the adjudicating authority had held that the goods is liable for confiscation under Section 113(i) and 113(d) of the Customs Act 1962 and imposed the penalties under Section 114 of the customs Act 1962 and under Section 114AA of the Customs Act 1962 read with Section 11(1) of the Foreign Trade (Development Regulation) Act 1992, Rule 11 and 14(2) of the Foreign Trade (Regulation) Rules 1993 read with provisions of Section 50 of the Customs Act 1962. Being aggrieved with the impugned order Appellants filed Appeals before the Commissioner (Appeals ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the bags were printed with Iranian language label and markings. As per the laws in UAE, the rice packed in Iranian language and labels as per Food Laws of Iran Government cannot be sold in UAE region as for selling in gulf region, the markings are required in Arabic and English. A precondition for the clearance of an import of any agricultural food products into Dubai is the Import Certificate from Dubai Municipality is required. Also, for any food product that is to enter the UAE, there must be a license granted to the consignee to trade in foodstuffs. In the impugned matter even the phytosanitary certificate declaring the destination as Iran was furnished before customs authority in India. There is no allegation or any evidence in the case, that the said certificates were amended at any stage in order to get the goods cleared in a country other than Iran. The findings of the Ld. Original authority as confirmed by the Appellate authority that the impugned goods have been exported to UAE merely because the same were discharged in UAE port, without verifying whether such goods could be exported to UAE in the absence of any evidence or whether these have been further shipped to Iran ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed in Iran only condition. In absence of any such condition, imposing of such condition by assumption as proposed by the impugned show cause notice and confirmation of such non existing condition has vitiated the proceeding. In the case of rice being exported to Iran there was no condition that goods cannot be exported or dealt with in any other manner by the Iranian buyer. In absence of any such condition the impugned show case notice liable to be dropped in limine only without going further in merits of the case. The declaration made before the customs authorities cannot be said to be incorrect in as much as the said goods were exactly as per the description at the time of effecting the exports. The change in B/L has been effected only after completion of all customs procedures and reaching of the vessel in international waters by the Shipping company. Penalty under Section 114AA is leviable only in case of any material particular being declared false or incorrect. Mere change of port of discharge from the one originally declared in SB other is not any offence under the Customs Act. The said change in some case is due to reasons known to consignee. It is also fact that the imp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er)] (iv) Chennai Marine Trading [2014 (304) ELT 354 (Mad.)] (v) A G Incorporation [2013 (287) ELT 357(Tri)] (vi) Pundole Shahrukh [2014 (313) ELT 573 (Tri.)] (vii) GTC Industries Ltd. [2011 (264) ELT 433 (Tri.)] (viii) Harminder Singh Chaddha [2018 (362 )ELT 95] (ix) Krishnaram Dyeing Finishing Works [2007 (209) ELT 410(Tri.) (x) Om Prakash Bhattia [2003(155) ELT 423 (SC) (xi) Rajeev Verma [2007(218)ELT 200 Del] (xii) Shri Rama Thenna Thayalan [2021-TIOL-2269-HC-MADCUS] (xiii) Shri Chinta Haran Oja CHA [2020-TIOL-611-CESTAT-DEL] 5. Heard both sides and perused the records of the case. We find that the case of the department is that M/s Janki Dass Rice Mills had filed the Shipping Bills/Export documents for export of goods i.e. Rice to Iran but the goods were delivered at UAE. The remittance was received in Indian Rupees from Iran instead of free convertible foreign currency. Thus, there appeared to be mis-declaration on part of Appellant. The revenue in support of allegations relied upon the statements of Director, CHAs and the officials of Shipping Lines. However, these persons were not examined in the adjudication proceedings even after the req ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Cross-examination is one part of the principles of natural justice : 23. A Constitution Bench of this Court in State of M.P. v. Chintaman Sadashiva Vaishampayan, AIR 1961 SC 1623, held that the rules of natural justice, require that a party must be given the opportunity to adduce all relevant evidence upon which he relies, and further that, the evidence of the opposite party should be taken in his presence, and that he should be given an opportunity of cross-examining the witnesses examined by that party. Not providing the said opportunity to cross-examine witnesses, would violate the principles of natural justice. A mere reading of the above said proposition clearly shows that the rules of natural justice require that a party must be given an opportunity to adduce all relevant evidence upon which he relies and further that the evidence of the opposite party should be taken in his presence by giving an opportunity of cross-examining the witnesses examined by that party. In the present case, neither any speaking order has been passed nor the respondent justified in not permitting the petitioner to cross-examine the above said eight witnesses. Thus, such attitude of the re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n received from the same buyers. 5.3 We also noticed that in the case of food products the goods which are exported to Iran required Phytosanitary Certificate with each consignment which is issued by the Ministry of Agriculture and Farmer Welfare, Government of India. These certificates are required to be enclosed with each consignment and these certificates are issued by the officials of Ministry of Agriculture and Farmer Welfare, Govt. of India after proper inspection of each consignment. In the present case we have gone through the Phytosanitary Certificates produced by the Appellant. Each of these Phytosanitary Certificate carries e-Registration No., the name of the exporter in India and consignee in Iran, number of bags and its quantity etc. There is no allegation or any evidence that the said certificates were amended at any stage in order to get the goods cleared in a country other than Iran. 5.4 Without prejudice to the above, we further find that Appellant lost the ownership of the goods as soon as let export order was issued by the Customs authorities. After the said let export order it was the responsibility of the Shipping Lines to ship the goods to the foreign ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and 113(i) of the Customs Act but these provisions were invoked by only alleging violation of para 2.53 of the FTP and section 8 of FEMA, 1999. We are therefore of the view that there was no violation of Customs Act in any manner. There is no dispute about the description of the goods, its quantity and value. The export of rice was neither prohibited nor restricted. It is a well settled law that in respect of alleged violation of foreign exchange, it is the erstwhile FERA authorities or FEMA authorities who are competent to initiate the proceedings against the party. In support of this finding we rely upon the law laid down by this Tribunal in the case of Chinku Exports Vs. Commissioner of Customs, Calcutta reported in 1999 (112) ELT 400 (Tri). This judgment has been upheld by the Hon ble Apex Court as reported in 2005 (184) ELT A36. This judgment has been followed by this Tribunal in the case of Hillari Computer Exports (P) Ltd vs. Commr. of Cus., Visaskhapatnam reported in 2006 (199) ELT 636 and in the case of Bank of Nova Scotia Vs. Commissioner of C.Ex (Adj), Bangalore reported in 2009 (233) ELT 260 (Tri.-Bang). Though the first two judgments relate to period when FERA was in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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