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TMI Blog2024 (10) TMI 1190X X X X Extracts X X X X X X X X Extracts X X X X ..... e exporter was given no opportunity to cross-examine any of the person whose statement was sought to be relied upon. The said persons were not examined by the Court and the Court had not expressed any opinion that the statements ought to be admitted, as contemplated under Section 138B (1) (b) of the Act. The question whether a person against whom a statement is relied upon ought to be given an opportunity to cross-examine the person who has made the statement was the subject matter for consideration by the Coordinate Bench of this Court in BASUDEV GARG, ARUN GUPTA, ANIL GOEL VERSUS COMMISSIONER OF CUSTOMS [ 2013 (5) TMI 350 - DELHI HIGH COURT] where it was held that ' The circumstances referred to in section 9D, as also in section 138B, included circumstances where the person who had given a statement is dead or cannot be found, or is incapable of giving evidence, or is kept out of the way by the adverse party, or whose presence cannot be obtained without an amount of delay and expense which, under the circumstances of the case, the court considers unreasonable. It is clear that unless such circumstances exist, the noticee would have a right to cross-examine the persons whose s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bills, and the adjudicating authority assumed that the said goods were also liable to be confiscated. Accordingly, the adjudicating authority directed the confiscation of the sale proceeds of Rs. 3,430/- which was available in the bank account of M/s Singhal Traders and ordered investigation into the remaining sale proceeds amounting to Rs. 1,13,43,550/-. 4. The adjudicating authority imposed the penalty of Rs. 25,00,000/- under Section 114 the Act as well as the penalty of Rs. 25,00,000/- under Section 114AA of the Act on the exporter M/s Singhal Traders. Additionally, the adjudicating authority also imposed the penalty of Rs. 5,00,000/- each on the suppliers as well as the penalty of Rs. 5,00,000/- under Section 114 of the Act on Dinesh Bhardwaj (G-card holder). 5. Against the said the adjudicatory order, three appeals were filed by the exporter (Manish Singhal), G-Card holder (Dinesh Bhardwaj), and CHA (Rajinder Pal Jindal) respectively. However, the said appeals were allowed in terms of the impugned order. 6. The CESTAT found that the adjudicating authority had relied upon various statements made by various persons as well as the test report submitted by the Central Revenue Ch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of CRCL officer? v. Whether in light of facts of the case the Tribunal was right in insisting on cross examination even in the case of confessional statements? 12. It is clear from the plain reading of the impugned order that the CESTAT had allowed the appeals on the sole ground that the statements, which formed the foundation of the order-in-original dated 23.11.2011 could not be used as relevant for proving the allegations against the respondents, in view of Section 138B of the Act. The exporter was given no opportunity to cross-examine any of the person whose statement was sought to be relied upon. The said persons were not examined by the Court and the Court had not expressed any opinion that the statements ought to be admitted, as contemplated under Section 138B (1) (b) of the Act. The question whether a person against whom a statement is relied upon ought to be given an opportunity to cross-examine the person who has made the statement was the subject matter for consideration by the Coordinate Bench of this Court in Basudev Garg v. Commissioner of Customs: 2013 SCC OnLine Del 1447 . It would be relevant to refer to the following extract of the said decision: 9. We have consid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e provisions of sub-section (1) shall, so far as may be, apply in relation to any proceeding under this Act, other than a proceeding before a court, as they apply in relation to a proceeding before a court. 11. We may straightaway say that the provisions of section 9D of the Central Excise Act, 1944 are identical to the provisions of section 138B of the Customs Act, 1962 which would be applicable in the present case. 12. Section 138B of the Customs Act, 1962 reads as under : 138B. Relevancy of statements under certain circumstances. ( 1) A statement made and signed by a person before any gazetted officer of customs during the course of any inquiry or proceeding under this Act shall be relevant, for the purpose of proving, in any prosecution for an offence under this Act, the truth of the facts which it contains, (a) When the person who made the statement is dead or cannot be found, or is incapable of giving evidence, or is kept out of the way by the adverse party, or whose presence cannot be obtained without an amount of delay or expense which, under the circumstances of the case, the court considers unreasonable; or (b) When the person who made the statement is examined as a witne ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be found, or is incapable of giving evidence, or is kept out of the way by the adverse party, or whose presence cannot be obtained without an amount of delay and expense which, under the circumstances of the case, the court considers unreasonable. It is clear that unless such circumstances exist, the noticee would have a right to cross-examine the persons whose statements are being relied upon even in quasi-judicial proceedings. The Division Bench also observed as under (page 498 of 1 GSTR) : Thus, when we examine the provision as to whether this provision confers unguided powers or not, the conclusion is irresistible, namely, the provision is not uncanalised or uncontrolled and does not confer arbitrary powers upon the quasi-judicial authority. The very fact that the statement of such a person can be treated as relevant only when the specified ground is established, it is obvious that there has to be objective formation of opinion based on sufficient material on record to come to the conclusion that such a ground exists. Before forming such an opinion, the quasi-judicial authority would confront the assessee as well, during the proceedings, which shall give the assessee a chance ..... X X X X Extracts X X X X X X X X Extracts X X X X
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