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TMI Blog2024 (10) TMI 505X X X X Extracts X X X X X X X X Extracts X X X X ..... who made the statement is fundamental. If a person is available for testimony and their previous statement is being used as evidence, the other party must be given the opportunity to cross-examine the person. Failing to provide this opportunity would violate principles of natural justice. The Delhi High Court in the caseJ K CIGARETTES LTD. ORS. AND M/S. GTC INDUSTRIES LTD VERSUS COLLECTOR OF CENTRAL EXCISE ORS. [ 2009 (8) TMI 64 - DELHI HIGH COURT] clarified that if the person who made the statement is available, the person should be presented for cross-examination when requested. It is also noted that the Courts have consistently recognised that if the department seeks to rely on the previously recorded statement of a person during an inquiry, the opposing party must be allowed to cross-examine that person in court to challenge the veracity of the statement. This provision ensures that any statement made in the absence of the accused (during the investigation phase) does not automatically hold evidentiary value unless the maker of the statement is subjected to questioning by both sides, thus adhering to principles of natural justice - In the instant case, it is noted that at the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the register and diary match with the dates of temporary electrical connection obtained from the electricity department. Consequent to the investigations, the Department alleged that for the period 2011-12 to 2015-16 (upto June), the total service tax liability of the appellant was Rs. 3,59,796/- along with interest penalty. Accordingly, a show cause notice dated 13.10.2016 was issued. Subsequently the proceedings were finalized by the adjudicating authority vide Order-In- Original dated 30.12.2016 wherein he dropped the proceedings as the respondent is entitled to small scale exemption as provided under Notification No.06/2005-ST dated 01.03.2005. The said order was reviewed by the Principal Commissioner, Central Excise Service Tax, Jabalpur (MP) vide Review Order dated 15.03.2017 and an appeal was filed before the Appellate Authority. The department filed an appeal before the Commissioner (Appeals), who allowed the appeal of the department and reversed the order of the adjudicating authority and restored the demand of Rs. 3,59,796/- under Mandap Keeper Service along with interest and equivalent penalty. 3. Learned Counsel for the appellant submitted that it is a settled law that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . The Revenue did not take any steps to examine the said persons. Learned counsel further stated that it is not open to drop the evidence in favour of the appellant and to pick the partial evidence which may be against the appellant. 3.2 Learned Counsel also submitted that the demand of service tax under wrong classification of service is not sustainable in law as the demand in the present case has been raised under the category of Mandap Keeper Service defines under Section 65(66) and Section 65(67) of the Finance Act, 1994. He further submitted that the tent owners used to provide the mandap, furnitures, utensils shamianas etc. The role of the appellant was limited to leasing his premises. Learned counsel further submitted that the department's case hinges around the 'Green Diary' which allegedly contains the details of the booking of the hall. He further submitted that presumption of documents in certain cases under Section 36A of the Central Excise Act is available only when the documents are produced by or seized from the custody or control of the person concerned. In view of above, it is only when such document is tendered in evidence against the person who produc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of appeal have submitted that the demand has been confirmed on the basis of diary which was recovered from their premises which show booking amounts. Under the law, there is a presumption about the truth of any documents recovered from the premises of a person, section 36A of the Central Excise Act, 1944 which is made applicable to service tax matter. 4.1 Learned AR further submitted that the demand of service tax is based on the entries made in the documents/diaries which had been admitted by Shri Chandra Shekhar Agrawal is his statement, that the entries related to booking amounts. The denial now that the diary was not written by them is an afterthought. The learned Authorized Representative contended that the original adjudicating authority had ignored vital evidences such as green coloured diary, Statement of the tent house owners and correlation of entries with booking by the customers while dropping the demand. The appellant had not disclosed their service tax liability to the department which established suppression of facts. In the light of above submission, learned AR prayed that the instant appeal may be dismissed. 5. We have heard the Ld. Counsel for the appellant and t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se Officer of a gazetted rank, are treated as admissible. Thus, protection is taken to treat the statements relevant only if they are made before an officer enjoying a higher rank/status. Secondly, (and that has already been taken note of) such statements are made relevant only under certain specified circumstances, and these are the ones which are beyond anybody s control. Thirdly (and this is most important), the quasi-judicial authority can rely upon the statement of such a person only when the stated ground is proved. For example, in those cases where the person who made the statement is dead, there should be sufficient proof that he is dead. In case, where a person cannot be found, the authority would have to form an opinion, based on some material on record, that such a person cannot be found. It would not be mere ipse dixit of the officer. In case, cogent material is not there to arrive at such a finding, the persons against whom the statement of such a person is relied upon can always challenge the opinion of the authority by preferring appeal to the higher authority, which appeal is statutorily available. Same yardsticks would apply to other grounds. If the quasi judicial ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... IR 1954 SC 465; and Bhatnagars Co. Ltd. v. Union of India, AIR 1957 SC 478}. 31. Interestingly, even in the present case, the attempt of learned senior counsel appearing for the petitioners was to show that the respondent No.1 ought to have given prior intimation and granted an opportunity to the assessee to make its submissions on invocability of Section 9-D itself and thereby enabling the assessee to take appropriate steps, as may be possible, in the circumstances of the case. He submitted that if a particular witness was not allowed to be cross-examined by stating that it was not possible to procure his presence without delay or expense, had the opportunity been given to the petitioners to meet the expenses, the petitioners would have borne the expenses and could have procured the presence of witnesses. Likewise, he argued that if the opinion was that it is the adverse party, i.e. the petitioner, who kept a particular person out of the way, the petitioner should have been confronted with that so as to enable him to contact the witness through his own resources and inform him about the time and place of the cross-examination, or else, to enable the petitioners to clarify the rele ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at a particular ground, as stipulated in the said Section, exists and is established; (iii) such an opinion has to be supported with reasons; (iv) before arriving at this opinion, the authority would give opportunity to the affected party to make submissions on the available material on the basis of which the authority intends to arrive at the said opinion; and (v) it is always open to the affected party to challenge the invocation of provisions of Section 9-D of the Act in a particular case by filing statutory appeal, which provides for judicial review . 7. We also take note that the Courts have consistently recognised that if the department seeks to rely on the previously recorded statement of a person during an inquiry, the opposing party must be allowed to cross-examine that person in court to challenge the veracity of the statement. This provision ensures that any statement made in the absence of the accused (during the investigation phase) does not automatically hold evidentiary value unless the maker of the statement is subjected to questioning by both sides, thus adhering to principles of natural justice. In the instant case, we note that at the original stage of adjudicati ..... X X X X Extracts X X X X X X X X Extracts X X X X
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