Patna High Court
Commissioner Of Customs, Patna vs Ghanshyam Prasad Gupta on 9 March, 2010
Author: S K Katriar
Bench: Sudhir Kumar Katriar, Kishore Kumar Mandal
MISC. APPEAL No.616 OF 2009
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Against the order dated 9.7.2009, passed by the Customs,
Excise and Service Tax Appellate Tribunal, East Regional
Bench, Kolkata, in Cus. Appeal No.369 of 2008.
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Commissioner of Customs, Patna, 5th Floor, C.R. Building,
Birchand Patel Marg, Patna.
..... Appellant.
Versus
Ghanshyam Prasad Gupta, S/o Late Purushottam Prasad, R/o
Trisal Road, Bank Road, Raxaul, East Champaran, Bihar.
.... Respondent.
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For the Appellant: Ms. Archana Meenakshee and
Ms. Archana Sinha, Advocates.
For the Respondent: Mr. Ganpati Trivedi, Advocate with
Mr. Dev Kumar Pandey &
Mr. Tarkeshwar Prasad Verma
Advocates.
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PRESENT
THE HON'BLE MR. JUSTICE SUDHIR KUMAR KATRIAR
THE HON'BLE MR. JUSTICE KISHORE KUMAR MANDAL
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S.K. Katriar, J. This appeal under section 130 of the Customs Act 1962
(hereinafter referred to as the „Act‟), is directed against the order
dated 9.7.2009, passed by the Customs, Excise and Service Tax
Appellate Tribunal, East Regional Bench, Kolkata, in Custom
Appeal No.369 of 2008 (Shri Ghanshyam Prasad Gupta Vs.
Commissioner of Customs, Patna), whereby the appeal preferred by
the respondent herein has been allowed, the orders of the two
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authorities below have been set aside, and the confiscation
proceeding against the respondent herein has been set at naught.
2. A brief statement of facts essential for the disposal of
the appeal may be indicated. In view of intelligence report, the
authorities under the Act were alert in the township of Raxaul, a
town at the Indo-Nepal border known for illegal import and export
activities. During the night intervening 3.11.2006 and 4.11.2006, at
about 01.00 hours, the functionaries of the department noticed goods
being carried on a Thela and was being escorted by a person on a
motorcycle. The Thela was moving towards the territory of Nepal
along. As soon as they noticed the departmental functionaries, both
of them took to their heels abandoning the goods-laden Thela and the
motorcycle, and disappeared in the labyrinthine lanes of the township,
taking advantage of the darkness of the night. Examination of Thela
revealed that it was loaded with logs of some kind of wood, red in
colour, and wrapped in plastic fabric. The functionaries then rolled
the Thela as well as the motorcycle to the godown of M/S Bihar
Carrying Co., Narendra Shrama Road, Raxaul. Two persons opened
the doors. A search of the godown disclosed that another
consignment of the same item had already been stored which was
also seized. It is relevant to state that the goods were red sandalwood
and combined together weighing 1269 Kg., valued at Rs.5,07,600/-.
The seized goods were deposited there and the godown was sealed.
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2.1) Enquiry under section 107 of the Act prima-facie
revealed involvement of the respondent. Statements of Binod Kumar
Singh and Arvind Kumar, Cashier and Manager respectively, of M/s.
Bihar Carrying Company, were recorded on 5.11.2006. Their
statements are marked Annexures 6 and 7 respectively. Thereafter
the statement of Sujeet Kumar Dey, representative and Booking
Clerk of Jayshree Transport (Pvt) Ltd. situate at Kolkata, was
recorded on 15.11.2006 (Annexure-4). Statement of Ram Kumar
Sharma, Director of Jayshree Transport Pvt. Ltd. was similarly
recorded on 28.11.2006 (Annexure-5). These statements were
recorded under section 108 of the Act.
2.2) In view of the materials which had come on record, the
authorities issued notice to the respondent. He refused or failed to
appear and, therefore, notices were issued to the respondents on
6.11.2006, 27.11.2006, 15.12.2006, 25.12.2006 and 10.3.2007,
calling him upon to appear before the authorities to enable them to
record his statement under section 108 of the Act. The respondent
did not appear as a result of which his statement under section 108 of
the Act could not be recorded though he had shown cause on
16.8.2007 (Annexure-A to the supplementary counter affidavit). The
Joint Commissioner of Customs, Headquarters, Patna, passed the
order dated 11.12.2007 (Annexure-2), under section 122 of the Act,
whereby the goods, the Thela, and the motorcycle have been
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confiscated, and penalty of rupees one lac has been imposed on the
respondent herein in terms of section 114 of the Act. Cash penalty
has also been imposed on another person, not relevant in the present
context.
3. Aggrieved by the order of the learned first authority, the
respondent preferred appeal which was rejected by order dated
20.8.2008 (Annexure-3), passed by the learned Commissioner
(Appeals), Customs and Central Excise, Patna. Aggrieved by the
same, the petitioner preferred appeal before the Tribunal which has
been allowed by the impugned order. Hence this appeal at the
instance of the department.
4. While assailing the validity of the impugned order,
learned counsel for the appellant submits that the statements of the
four witnesses under section 108 of the Act adequately implicates the
respondent. The same is admissible evidence in terms of section 108
of the Act. She relies on the judgment of the Supreme Court in
Bhana Khalpa Bhai Patel vs. Assistant Collector of Cus., Bulsar,
reported in 1997 (96) E.L.T. 211 (S.C.)= A.I.R. 1998 S.C. 1487.
She submits that the cause shown by the respondent, read with the
documentary evidence on record, fully established the culpability of
the respondent. She also submits that the primary onus of proof is on
the department to establish that the goods in question are smuggled
or meant to be smuggled which has been fully discharged by the
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department. On the other hand, the respondent has failed to discharge
his onus, and he has equally failed to avail of the opportunities by his
refusal to appear before the authorities. She relies on the judgment of
the Supreme Court in Collector of Customs, Madras and others vs.
D. Bhoormull, reported in 1983 E.L.T. 1546 (S.C.). She also
submits that the respondent in his appeal before the learned
Commissioner had prayed for reduction of the punishment which by
necessary implication means that he has accepted his culpability. She
lastly submits that the respondent is trying to take undue and
unjustified advantage of hair-splitting technicalities. The Supreme
Court had observed that there is no requirement under the Act to
prove the culpability with mathematical precision. The substance of
guilt has to be established which, in her submission, has been fully
established.
5. Learned counsel for the respondent in his elaborate
submissions has submitted that the prescribed procedure has not been
followed. He tried to impress on us the relative scope and sweep of
sections 108 and 122, and Chapter-14, of the Act. He has also taken
us through the departmental manual. He next submits that there is no
worthwhile evidence to establish the culpability of the respondent.
5.1) He also submits that the department is trying to invoke
section 123 of the Act, but he is not covered by any one of the
clauses therein. He next submits that the consignment note is in the
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name of Ghanshyam Gepu, whereas the respondent‟s name is
Ghanshyam Prasad Gupta. He next submits that the respondent was
not allowed cross-examination of the witnesses. He relies on the
following reported judgments:
(i) (2005)10 S.C.C. 634 (Lakshman Exports Ltd. vs.
Collector of Central Excise);
(ii) (2008) 3 S.C.C. 279 (New India Assurance
Company Ltd. Vs. Nusli Neville Wadia and
another), paragraph 45.
5.2) He lastly submits that it is given to every litigant to set
up a prayer in the alternative, and pray for reduction of sentence.
6. We have perused the materials on record and considered
the submissions of learned counsel for the parties. Before we proceed
further, we must inform ourselves adequately of the nature, scope,
and the content of the Act, and should in the same vein appreciate the
onus cast on the department to bring the respondent‟s action within
the mischief of the Act. Sufficient guidance has been provided by the
Supreme Court in its judgment in Collector of Customs, Madras
and others vs. D.Bhoormull (supra), paragraphs 30 and 31 of the
same are reproduced hereinbelow:
"30. It cannot be disputed that in proceeding for
imposing penalties under clause (8) of Section 167,
to which Section 178-A does not apply, the burden
of proving that the goods are smuggled goods, is on
the Department. This is a fundamental rule relating
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to proof in all criminal or quasi-criminal
proceedings, where there is no statutory provision to
the contrary. But in appreciating its scope and the
nature of the onus cast by it, we must pay due
regard to other kindred principles, no less
fundamental, of universal application. One of them
is that the prosecution or the Department is not
required to prove its case with mathematical
precision to a demonstrable degree; for, in all
human affairs absolute certainty is a myth, and as
Prof. Brett felicitously puts it--"all exactness is a
fake". El Dorado of absolute Proof being
unattainable, the law, accepts for it, probability as a
working substitute in this work-a-day world. The
law does not require the prosecution to prove the
impossible. All that it requires is the establishment
of such a degree of probability that a prudent man
may, on its basis, believe in the existence of the fact
in issue. Thus legal proof is not necessarily perfect
proof often it is nothing more than a prudent man‟s
estimate as to the probabilities of the case."
"31. The other cardinal principle having an
important bearing on the incidence of burden of
proof is that sufficiency and weight of the evidence
is to be considered to use the words of Lord
Mansfield in Blatch v. Archar (1974) 1 Cowp. 63 at
p. 65 "According to the Proof which it was in the
power of one side to prove and in the power of the
other to have contradicted". Since it is exceedingly
difficult, if not absolutely impossible for the
prosecution to prove facts which are especially
within the knowledge of the opponent or the
accused, it is not obliged to prove them as part of its
primary burden."
(Emphasis added)
It is thus evident that in a proceeding under the Act the
primary onus to prove that the goods in question are contraband
goods and are within the mischief of the Act, is on the department.
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There is no requirement to prove the same with mathematical
precision.
7. Law is equally well-settled that in all such quasi-judicial
proceedings, the rules of evidence do not apply with its rigours. The
basic requirement is that the principles of natural justice must be
observed and the delinquent person must be informed of all the
materials that have come against him to enable him to put up his
defence. It is in this background that we are required to examine the
facts and circumstances of the present case. The admitted position is
that Raxaul is situate in the State of Bihar at the Indo-Nepal border,
and has made itself notorious for smuggling activities. Bihar and
Nepal share a very long length of common boundary which is quite
porous, full of hilly and jungle areas, and it is very difficult for the
Government of India to guard it. It is equally the admitted position
that the goods in question were intercepted in the township of Raxaul
when it was in the process of being exported to Nepal. It is
particularly noticeable that the goods were being transported
surreptitiously at a very unearthly hour. It was 01.00 hours during the
night intervening 3.11.2006 and 4.11.2006. The authorities were
acting on the basis of intelligence report, and on being intercepted
the, Thelawala and the motorcycle rider, took to their heels. The
functionaries rightly took the Thela and the motorcycle to the
godown of M/s. Bihar Carrying Co. Pvt. Ltd. which led seizure of
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further consignment of red sandalwood lying in the godown. This
was followed by intensive enquiry. The statements of at least four
persons, who were functionaries of the two transporters, were
recorded. There is no doubt about the legal position that their
statements in the scheme of the Act are admissible evidence in terms
of section 108 of the Act. The authorities had also examined the
consignment note which, according to the appellant, recorded
Ghanshyam Gupta, whereas according to the respondent, recorded
Ghanshyam Gepu. We will have to deal with this contention at the
appropriate stage.
8. As soon as the situation became clear to the authorities
as to the complicity of the respondent summons were issued to him
as many as five times and he disobeyed each one of them. It does not
need any emphasis to state that the respondent was duty-bound to
respond to the summons which he persistently disobeyed. We wish to
state at this stage that extraordinary writ jurisdiction is never
exercised in favour of a person who has no respect for the lawful
authority of the State, no respect for the rule of law and the
established procedure. This will undoubtedly weigh against the
respondent. The learned first authority has observed as follows in
paragraph 4.07 of his order dated 11.12.2007:
"4.07. I find it all the more surprising that even after
issue of 05 repeated summons Shri Ghanshyam
Prasad Gupta did not appear before the
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investigation to clarify his stand in the matter. His
routine requests for another date or appearance after
every summon on one pretext or the other and
finally not presenting himself for examination even
after four extensions only shows his conscious guilt
and apprehension of getting exposed during
examination under Section 108 of Customs Act
1962. Section 108 of the Customs Act, 1962
empowers the officers of Customs to summon any
persons to give evidence and produce documents
before any gazetted officer of custom and give
evidence or to produce a document or any other
thing in any inquiry which such officer is making in
connection with the smuggling of any goods and
that all persons so summoned shall be bound to
attend either in person or through an authorised
agent as such officer may direct and all persons so
summoned shall be bound to state the truth upon
any subject, in respect of which they are examined
or make statements and produce such documents
and other things as may be required. The
expressions "any person" includes a person who is
suspected or have reason to believe to be concerned
in the smuggling of goods. But it is found that the
Noticee No.1 Sri Ghanshyam Prasad Gupta never
bothered to appear before the investigating agency
as a law abiding citizen in spite of various summons
issued to him on one pretext or other. He miserably
failed in his effort to prove his innocence and
always kept seeking adjournments either on one
plea or other through his advocate eg., that he was
framed by the other noticees, which was obviously
an after thought and rather goes on to prove his
involvement in the case."
We must give full credit to the authorities who served
an exceptionally exhaustive show-cause notice, wherein they
summarised the entire materials which had come on record against
the respondent and conveyed the same by their show-cause notice
dated 24.4.2007 (Annexure-1), issued in terms of section 124 of the
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Act. The respondent had shown cause by his communication dated
16.8.2007.
9. On a consideration of the entire materials on record, the learned first authority passed an exhaustive order under section 122 of the Act, whereby the goods have been confiscated and a cash penalty of rupees one lac has been imposed on the respondent. As stated hereinabove, the respondent‟s appeal has been rejected by the learned Commissioner (Appeals). The learned first authority and the learned Commissioner of Appeals have recorded concurrent findings of facts that Ghanshyam Prasad Gupta, the respondent herein, was the consignor as well as the consignee. The goods had been booked at Kolkata, and the destination station was Raxaul, the heaven of smugglers. They have concurrently found that the goods belonged to Ghanshyam Prasad Gupta which he was trying to smuggle to Nepal and is, therefore, liable under the Act.
10. It is relevant to state that the question of cross- examination of any witness would have arisen had he personally appeared and made prayer to that effect. A mere statement in the pleading is always treated by the Court to be grossly inadequate. It is trite law that the litigant makes multiple prayers in his pleadings, but those have to be pressed before the Court. The respondent by his purposive absention, failed to avail of the opportunities. We must state to the credit of the authorities that they patiently issued 12 summons after summons to the respondent in an act of fairness. We notice in the order of the learned first authority that, at the final stage, the respondent appeared through his counsel by filing duly executed Vakalatnama. This cannot be in compliance of the five summonses for personal appearance so that his statement under section 108 of the Act could be recorded.
11. Of the four persons who made statements under section 108 of the Act two have made statements which clearly implicate the respondent. For example, Binod Kumar Singh has stated in his statement that "...;g eky esjs jDlkSy xksnke esa fnukad 24&9&06 dks Vzd ~ ds n~okjk vk;k Fkk@ jDlkSy esa eky ikusokys txg ij Self (Consignment Note) fy[kk gqvk gS, vFkkZr Hkstus vkSj ikusokyk O;fDr Jh ?ku';ke xqIrk gS@ He has further stated that "... eSa vius xkMZ dks ?ku';ke xqIrk uke ds O;fDr ls ifjp; djk;k Fkk tks fd cSad jksM, jDlkSy, dk fuoklh gS!"
12. We also cannot fail to take notice of the statement of Arvind Kumar who has made the following statement under section 108 of the Act:
"iz'u la[;k (11)- fnukad 4&11&2006 dks tks eky vkids xksnke ifjlj ls jk=h igj esa fudyk vkSj dLVe vf/kdkfj;ksa n~okjk tIr fd;k x;k og eky jk=h igj esa dSls fudyk vkSj fdldks MhyhHkj gqvk? bl lanHkZ esa foLr``r tkudkjh ns@ 13 mRrj& fnukad 3&11&06 dks Jh ?ku';ke xqIrk 'kke dks ikWap cts gekjs dSlh;j fouksn dqekj flag ds ikl vk;s cksys fd vkt eSa ,d Bsyk eky ys tkmWaxk ckdh eky dy ys tkmWaxk@ eky yxHkx nks ekg ls iM+k gqvk Fkk@ geyksx ckj&ckj rxknk dj jgs Fks fd vki viuk ydM+h ys tk;s gekjk txg #dk gS@ bl dkj.k fouksn dqekj flag us vfuy flag xkMZ dks cksy fn;s fd budks ,d Bsyk eky tc vk;saxs rks ns nsuk@ geyksx us dYiuk Hkh ugha fd;k Fkk fd og e/; jk=h es vkdj gekjs xkMZ ls eky ys tk;saxs@ og yksdy vkneh Fks xkMZ Hkh mudks tkurs Fks bl dkj.k mudks vUnj vkus fn;k@ eSa vkSj esjs dSlh;j nksuks dks gh ckgj f~udyk Fkk bl otg xkMZ vfuy flag laidZ ugh dj ldk@ oSls Hkh gekjs Vzk~ UliksVZ es tks Qksu gS mlls ckgj Qksu ugh fd;k tk ldrk gS vkSj vfuy flag us crk;k fd dksbZ Hkh cqFk ml oDr ugha [kqyk Fkk fd og geyksxks dks crk lds fd bruh jkr dks eky ysus dh ftn dj jgs gS vr% og ;g lksprs gq;s fd eky bUgh dk gS vkSj fouksn dqekj flag us dgk Fkk bl dkj.k og eky ns fn;a@ ;g vc esjs le> es vk jgk gS fd og bruh jk=h esa eky dks D;ks mBkuk pkgrs Fks@ iz'u la[;k (12)- vki iwoZ iz'u ds mRrj esa ;g dgk gS fd vc vkidks irk pyk fd Jh xqIrk ;g eky jkr esa v/kZjk=h ds ckn NqM+kuk pkgrs Fks& D;k vki bls foLrkj ls crk;saxs?
mRrj& ge foLrkj ls crk;saxs fd ydM+h dk dUlkbuesaV igyh ckj gekjs ;gkWa vk;k Fkk vkSj geyksx tjk Hkh ugh HkWaki lds fd ;g bruk 14 laosnu'khy oLrq gS fd u flQZ Hkkjrh; dkuqu cfYd vUrjjk"V~zh; O;kikj vf/kfu;e ds rgr izfrcaf/kr gS ,oe bl rjg ls Hkjrh; dkuqu ,oe vUrjjk"V~zh; dkuqu dk mYya?ku gqvk gS@ blls rks eSa bruk rks le> gh ldrk gWaw fd blh dkj.k ls eky dkQh fnuksa rd esjs ;gkWa iM+k jgk tc fudkyk x;k rc jk=h ds ,sls le; esa tc lkjh nqfu;k lksbZ jgrh gS@ blls tqM+s rF;ksa ij fopkj djus ij ;g irk pyk fd ;g eky usiky ys tkus dh dks'kh'k dh xbZ blh dkj.k ls jkr ds vU/ksjs dk Qk;nk mBkus dh dks'kh'k dh xbZ @ iz'u la[;k (13) vki ?ku';ke xqIrk dks fdrus fnuksa ls tkurs gS vkSj dsSls tkurs gSa?
mRrj& eS vkSj ?ku';ke xqIrk nksuks jDlkSy fuoklh gwaW@S eSa Hkh ;gh iSnk gqvk gWwa vr% yksdy esa dkQh yksxkas dks tkurk gWwa vkSj blh dkj.k eSa ?ku';ke xqIrk th dks tkurk gWwa@ ysfdu gels mudk futh ;k O;kolkf;d laca/k dksbZ [kkl ugh gS vkSj bl ydM+h ds dUlkbUesaV vkus ds ckn es tc og ,d fnu og esjs V~kz UliksVZ vkfQl es vk;s rHkh geus tkuk fd ;g ydM+h ?ku';ke xqIrk th dk gS (D;ksfd fcYVh es ?ku';ke xqIrk th dk dydrk dk irk fn;k gqvk Fkk) vkSj mUgksus dgk fd vki fpUrk ugh dfj;sxk ge lgwfy;r ls leku mBk ysaxs blds ckn ;nk&dnk gekjs dSlh;j mudks eky mBkus ds fy;s laidZ djrs jgs@ijUrq mUgksus eky dks dc vkSj dSls mBk;k ge crk pqds gSa vkSj vc foHkkx dks Hkh irk gS@ (Emphasis added) 15
13. Before we proceed further, we would like to deal with the contention advanced on behalf of the respondent that the consignment note recorded the name of the consignor and consignee as Ghanshyam Gepu. This aspect of the matter has been dealt with by the learned first authority and we entirely agree with the conclusion arrived at by him. The relevant portion of the order is reproduced hereinbelow:
"Shri Ghanshyam Prasad Gupta has further stated that he did not book the consignment of the wood in Jay Shree Transport Ltd., Kolkata. In support of his contention, he has stated that the consignment note submitted by the Manager of Bihar Carrying Co., Raxaul, neither bears his name nor his signature and the address of the consignor is also incomplete. I find from the copy of the consignment note in the file that Shri Ghanshyam Prasad Gupta has willfully misconstrued the name of the consignor as „Ghanshyam Gepu‟. In fact, even through cursory look of the consignment note, anyone can read the name as „Ghanshyam Gupta‟. The style of writing letters„t‟ and „a‟ in the word „Gupta‟ clearly matches with the letter„t‟ and „a‟ of the word „Kolkata‟ written just above the name of consignee. As regards writing full address of the consignor is concerned, it is normal practice in the transport business that the addresses are written in short and the booking clerk does not normally verify the genuineness of either the consignor or his address."
Learned counsel for the appellant is, therefore, right in her submission that the respondent is trying to take undue advantage of the procedure by advancing hair-splitting arguments. We are convinced that Ghanshyam Prasad Gupta was the consignor and 16 consignee of the goods in question, as has been found and held by the two authorities and was making attempts to smuggle the goods across the border surreptitiously at unearthly hour.
14. We must deal with the contention advanced on behalf of the respondent that Tribunal is the last forum of facts which has concluded that there is no material on record to connect the respondent with illegal exports of goods. He has also relied on the judgment of the Supreme Court in Metroark Ltd. Vs. Commissioner of Central Excise, Calcutta, reported in (2004)12 S.C.C. 505, wherein, with respect to the scope and ambit of Article 136, it has been observed that unless it is shown that there is something perverse in its finding, the Supreme Court will not interfere with the fact-finding of the Tribunal. It must be stated that the judgment deals with the scope and ambit of the Supreme Court under Article 136 of the Constitution of India. Secondly, law is well settled that the High Court in exercise of jurisdiction under Articles 226 and 227 of the Constitution normally takes the findings of facts recorded by the forum of facts as final. This is subject to well-known exception that the High Court can, on the basis of the materials on record, come to the conclusion that the findings of facts recorded by the last forum of facts were perverse. We indeed feel unhappy at the perfunctory manner in which the Tribunal has dealt with the whole matter. The learned first authority as well as the learned 17 Commissioner of Appeals have taken pains to examine the entire materials on record and reached the conclusions. The learned Tribunal has, in a spirit of bravado refused to examine the facts and by its sweeping observations upset the findings of facts recorded by the two authorities, and recorded perverse findings that there is no material to connect the respondent with the alleged export of goods. We entirely disagree with the approach of the Tribunal.
15. In the result, this appeal is allowed, the order of the learned Tribunal is hereby set aside, and that of the learned Commissioner (Appeals) is hereby restored.
16. In the circumstances of the case, there shall be no orders as to costs.
(S K Katriar, J.) Kishore K. Mandal, J. I agree.
(Kishore K. Mandal, J.) Patna High Court, Patna.
Dated the 9th day of March, 2010.
S.K.Pathak/ (AFR)