Custom, Excise & Service Tax Tribunal
Mittal Impex vs Principal Commissioner, Customs-New ... on 31 March, 2022
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL
NEW DELHI
PRINCIPAL BENCH
Court No. IV
CUSTOMS APPEAL NO. 50999/2021
[Arising out of Order-in-Original No. VIII/ICD/TKD/6/ADJ/IMP/
Pr.Commr/05/2020 dated 13.08.2021 passed by the Principal
Commissioner of Customs (ICD, TKD), New Delhi]
M/s. MITTAL IMPEX ... APPELLANT
Through its Proprietor
Shr Harsh Mittal
VERSUS
PRINCIPAL COMMISSIONER,
CUSTOMS, (ICD TKD )
NEW DELHI ... RESPONDENT
APPEARANCE:
Shri Akhil Krishan Maggu, Advocate for the Appellant
Shri Rakesh Kumar, Authorised Representative for the Department
CORAM:
HON'BLE MR. P V SUBBA RAO, MEMBER (TECHNICAL)
HON'BLE MRS RACHNA GUPTA, MEMBER (JUDICIAL)
DATE OF HEARING: December 17,2021
DATE OF DECISION: 31-03-2022
FINAL ORDER No. 50304 /2022
PER RACHNA GUPTA
Present appeal has been filled against the Order-in-
Original adjudicating authority bearing No. 05/2022 dated
13.8.2021 vide which the request for cross examination of
panch-witnesses and of departmental officers with respect
to Show Cause Notice No. 33238 dated 7.2.2020 and
corrigendum to Show Cause Notice No. 1720 dated
18.1.2021 has been rejected.
C/50999/2021
2. The appellant was suspected based upon the
intelligence to be engaged in evasion of duty and other
government tax by way of mis-declaration of brand of
goods/ description of the goods and also through under-
valuation in imports. The said Show Cause Notice was
issued proposing rejection of classification of the goods in
the Bills of Entry as parts and panel of LED TV and
proposing the goods to be classified as complete set of LED
TV. The declared value was proposed to be re-
determined with a demand of differential customs duty and
imposition of penalty. While adjudicating the said Show
Cause Notice the appellant requested for cross
examination of 9 witnesses and officers which was rejected
vide the order under challenge holding that there is
sufficient admission of the appellant-applicant about the
allegations levelled in the Show Cause Notice. Denial of
cross examination in such circumstances is alleged by the
appellant to be violative of principles of natural justice.
3. The appellant is aggrieved by the denial of cross
examination in the impugned appeal and prays for setting
aside of said order and a permission to cross examination of
panch witnesses of departmental officers based upon whose
statement that the impugned Show Cause Notice has been
issued.
4. We have heard Shri Akhil Krishan Maggu, learned
Counsel for the Appellant and Shri Rakesh Kumar, learned
Authorised Representative for the Department.
5. It is submitted on behalf of the appellant that the
right to cross examination is an indefeasible right. The
violation thereof amounts to violation of basic principles of
natural justice i.e., audi alteram partem. It is submitted
that to substantiate the charges against the appellant
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persons whose statements have been relied upon need to
be cross examined to enable the appellant to show the
discrepancy in the show cause notice and to show the
negligence during the investigations. It is mentioned that
the allegation that full TV sets have been imported by the
appellants can be conflicted only by cross examining the
investigating officers and even the panch witnesses in
whose presence the imported goods were opened and
examined. The cross examination was required more for
the reason that the department has failed to file any
Chartered Engineers' report about the goods so as to verify
if the goods were mere parts of TV sets or were complete
sets of TV. The appellant is otherwise engaged in selling
imported spare parts. Various bills and purchase orders
and invoices in the possession of the appellant are required
to be produced and the witnesses are required to be
confronted with respect to the said documents. It is further
submitted that there have otherwise been several
illegalities in the process of investigations. The proprietor
of the appellant Shri Harsh Mittal was illegally and
forciably detained by the investigating authority. The
order is accordingly prayed to be set aside and appeal is
prayed to be allowed.
6. Learned Counsel places reliance upon the following
decisions:
1. Zahira Habibullah Sheik vs State of Gujarat
[2006 AIR SC 1367];
2. Ayaaub Khan Noorkhan Pathan vs The State of
Maharashtra & ors decided on 08.11.2012 in Civil Appeal
No. 7728 of 2012.
3. Laxman Exports Ltd. vs Collector of Central Excise decided
on 18.4.2003 [2005 (10) SCC 634];
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4. Basudev Garg vs Commissioner of Customs, by Division
Bench of Ho'ble High Court of Delhi delivered on
12.4.2013.
5. Writ Petition 1854 of 2000 1992 decided on 28.8.2009
titled J K Cigarette Ltd. & Ors. vs Collector of Central
Excise & Ors.; and
6. Andaman Timber Industries vs Commissioner of Central
Excise Kolkatta decided 02.09.2015 by Hon'ble Apex
Court in Civil Appeal No. 4228/ 2006].
7. To rebut the submissions, learned Departmental
Representative has submitted that the appellant filed the
Bill of Entry declaring the goods as unbranded LED TV
panels whereas on examination, the goods were found as
Curved LED panel of Samsung Brand. The value thereof
was also found to be wrongly declared. Hence present is the
case of clear mis-declaration and under valuation. Not only
this the appellant has been found to be wrongly availing the
benefit of exemption notification No. 50/2017-Cus. It is
mentioned that the goods were not at all parts of LED
panels as claimed by the appellant but these were ordered
to be supplied as either TVs in SKD form or as complete
TV sets which were deliberately unassembled into panels
and parts so as to fit into different containers to take
inadmissible benefit of the notification. The documents
recovered during investigation and the statement recorded
even of the proprietor of the appellant sufficiently proves
the allegations of the Show Cause Notice. It is in the reply
dated 16.6.2021 to Show Cause Notice that the cross
examination of 5 Departmental Officer and 4 independent
witnesses was made by the appellant which has been rightly
been rejected by the Department. Thus Appeal is
accordingly prayed to be dismissed. Learned Departmental
Representative has emphasised upon the decisions of:-
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1. Surjeet Singh Chhabra vs Union of India
[1997 (89) ELT 646 (SC)];
2. Silicon Concept International (P) Ltd. vs Pr.
Commissioner of Customs, ICD, TKD [ 2019
(368) ELT 710 (Tri-Del)];
3. M/s. A V Agro Products Ltd. vs Commissioner
of Customs, CE & CGST, New Delhi [2020
(373) ELT 258 (Tri-Del)].
8. After hearing the rival contentions, it is held as
follows:
The moot question to be decided is whether the
right to cross examination of departmental and
panch witnesses must be allowed to the
appellant in the given facts and circumstances ?
9. The right to cross examination is considered as a
principle of natural justice as it corresponds to
foremost principle of natural justice what is commonly
known as 'audi alteram partem' and the absence
thereof may adversely affect the party. As it was held
by Hon'ble Apex Court in the case of Canara Bank
and Ors vs Shri Debasis Das and Ors. reported as [2003
AIR SCC 2041] and was reiterated in the case titled as
Nagarjun Construction Co. vs Government of
Andhra Pradesh . The Constitution Bench of Hon'ble
Apex Court earlier in the case of Sate of Madhya
Pradesh vs Chintaman Sadashiva Vaishampayan
reported as [AIR 1961 SC 1623] has held
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that rules of natural justice requires that party must be
given the opportunity to adduce all relevant evidence upon
which he relies and further that the evidence of positive
commencement should be taken in his presence was that he
be given an opportunity to cross examination, the
witnesses examination of the other party charges the non
providing of the said opportunity was held to be violation of
principles of natural justice. The said view has been
endorsed in the case of Andaman Timber Industries vs
Commissioner of Central Excise Kolkata decided on
02.09.2015 in Civil Appeal No. 4228 of 2006 and also in J&
K Cigarettes Ltd. (supra) case. Simultaneously the
Hon'ble Apex Court in the case of Transmission
Corporation of AP Ltd. vs. Shri Rama Krishna Rice
Mill reported as [AIR 2006 SC 1445 held that:
"In order to establish that the cross-examination is necessary
the consumer has to make out a case for the same. Merely
stating that the statement of an officer is being utilised for the
purpose of adjudication would not be sufficient in all cases. If an
application is made requesting for grant of an opportunity to
cross examine any official, the same has to be considered by the
adjudicating authority who shall have to either grant the request
or pass a reasoned order if he chooses to reject the application.
In that event an adjudication being concluded, it shall be
certainly open to the consumer to establish before the Appellate
Authority as to how he has been prejudiced by the refusal to
grant an opportunity to cross examine any official."
10. Earlier also while deciding the case titled as K L
Tripathi vs State Bank of India & Ors. reported as
[AIR 894 SC 273] the Hon'ble Apex Court held that in
order to sustain the complaint of violation of principles of
natural justice on the ground of absence of opportunity of
cross examination, it must be established that some
prejudiced has been caused to the appellant by the
procedure followed. It was held that the party who does
not want to controvert the veracity of evidence on record,
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or of the testimony gathered behind his back, cannot
expect to succeed in any subsequent grievance raised by
him, stating that no opportunity of cross-examination was
provided to him. Similarly was the view of Hon'ble Apex
Court in the case titled as Union of India vs P K Roy,
reported as [AIR 1968 SC 850] and the case titled as
Channabasappa Basappa Happali vs. State of Mysore,
reported as [AIR 1972 SC 32].
11. Coming to the facts of the present case, the
allegations of Show Cause Notice are based upon the
physical examination of the goods that too in the presence
of the appellant and the appellant's proprietor. He had
declared the said goods in the Bill of Entry as unbranded TV
panels. There is no denial of the appellant that said
physical examination revealed that the goods instead of
being TV parts were LED TVs of Samsung brand though in
SKD form. There is no denial that the parts were imported
in different consignments. In his statement dated
15.01.2018 the appellants proprietor himself has admitted
that there was no written agreement or contract existed for
the export nor any written purchase order placed nor even
any written quotation /proforma invoice was supplied to
him with respect to the goods in question. He produced
some invoices through e-mil and assured to provide the
same to the Department but he fails to supply the same
with the plea that he is in the habit of deleting emails.
Still when his email was got opened by him in the presence
of investigating officer, the invoices which were recovered
were containing the price of complete LED TV , and mode
of supply as SKD module Kit. Similar was the mention in
the sale contract and proforma invoice which got recovered
from the goggle drive of Shri Harsh Mittal, properitor of
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Mittal Impex company, the invoice No. 17066 as was
mentioned in the impugned Bill of Entry was also found
having the description of the goods as 24" LED TV. Thus
the definite match was observed by the investigating team
in the documents submitted by the importer / appellant at
the time of importing goods and the invoices recovered
during investigation. These documents were recovered
from the appellant's own mail which was got opened by him
in the presence of investigating officer but on the
computer installed in the SIIB brand. He also put his
signatures on the print outs of various emails retrieved from
his emails. These documents have been made the basis for
allegations in the impugned Show cause notice.
12. The appellant had submitted his reply to the said
Show cause notice vide letter dated 16.06.2021. Perusal
thereof shows that the no instance of prejudice has been
mentioned in the said reply. The appellant was still
declaring his goods as unbranded TV parts with no
specific denial that the physical examination of his
consignments in his presence revealed that all goods in his
consignments were of Samsung brand. That the appellant
has taken the plea that there is no Chartered Engineer's
report to support the allegation of the Department, but
there has been the examination report of Customs Officer
dated 19.11.2017 (check) and re-examination reported
dated 11.5.2018(check) categorically stating that the
goods were branded LED panels and parts in TV glass
casing but they found them without remote control without
power cable without the mother board and without the
sockets. There is no denial that the parts were
simultaneous imported by the appellant but in different
consignment.
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13. Thus we are of the opinion that nothing cogent has
been brought in reply to the Show Cause Notice to prima
facie falsify the allegation of show cause notice or even to
make the case of any prejudice or to establish that some
prejudice has been caused to the appellant by procedure
followed. There is no case of the appellant that his
statement dated 15.01.2018 was his involuntary statement
given in coercion. No retraction is at all apparent on
record. The Hon'ble Apex Court in the case of Surjeet
Singh Chhabra vs Union of India (supra) has held that
confession though retracted is an admission and binds the
petitioner. The Customs Officer is not a police officer.
Hence the confession made to them is an admissible
evidence, hence there will be no need to permit the cross
examination of the panch witnesses. We also draw support
from the decision in the case of Kanungo & Co. Vs
Collector of Customs Kolkata and Others reported as
[1993 (13) ELT 1486 SC] wherein it is observed as
under:
"12 .........In our opinion, the principles of natural justice do
no require that in matters like this the persons who have given
information should be examined in the presence of the appellant
or should be allowed to be cross-examined by them on the
statements made before the Customs Authorities."
14. The Hon'ble High Court of Karnataka also in the case
of N S Mahesh vs Commissioner of Customs, Cochin
reported as [2016 (331) ELT 402 (Ker)] has held that -
1. ............the respondent specifically deals with the request
of the petitioner, and finds as follows :
"i. Cross-examination of all officers who assessed, audited,
I examined the impugned consignments :
The investigating unit has developed the case on the
basis of documents recovered during investigation and other
evidences and not relied on statements of any officers who
examined/audited/assessed the consignment. Moreover said
officers have discharged these functions as part of their official
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duty, based on documents provided by the importer. Further
noticee No. 2 has not given any reasons for examining the said
officer, nor the evidences sought to be brought out from them. It
is also learnt that the dockets of the bills of entry relied upon by
investigation have already been supplied along with the show
cause notice. However if required, noticee No. 2 can obtain
additional set of copies of documents from SIIB, under prior
intimation to undersigned. Accordingly the request for cross-
examining all officers who assessed/audited/examined the
impugned consignments cannot be acceded to.
............
2. On a perusal of Ext.P5 order, and the reasons given by the respondent to deny the request of the petitioner for cross- examination, I do not find any illegality in the said order that would warrant an interference with the said order in these proceedings under Article 226 of the Constitution of India. The writ petition, in its challenge against Ext.P5 order, therefore fails, and is accordingly dismissed."
15. In the decision of this Tribunal in the case of M/s. A V Agro Products Ltd. Vs. Commissioner of Customs, Central Excise and CGST New Delhi reported as [2020 (373) ELT 258 (Tri-Delhi) has held that-
"5. ......As far as applicability of Section 9D of Excise Act/138B of Customs Act as rightly observed by the adjudicating authority that the statement recorded were more in the nature of confession. The same cannot be the scope applicability of Section 9D. I draw support from Silicone concept (supra) as is emphasised by the Department."
16. Similarly in another decision this Tribunal in the case of Silicon Concept International (P) Ltd. Vs Pr Commissioner of Customs, ICD TKD reported as [2019 (368) ELT 710 (Tri-Del)] has held that -
13. From the above discussion it becomes clear that the confessional statements are out of the ambit of Section 9D as relied upon by the appellant and as has been considered in the various case laws relied upon by the appellant. The co-noticee, if his statement amounts to confession, cannot be compelled to be cross-examined and there would be no violation of principles of natural justice in that case. Though ample opportunity with the proceede/assessee has to be granted to put forth his defence, however, the assessee cannot be compelled to self-incriminate himself. In view of the said observations we are of the opinion that permission for cross-examining Shri Vineet Saluja and Shri 10 C/50999/2021 Pradeep Sharma has rightly been denied. As far as Ms. N. Rashmi and Shri Amit Mallik are concerned, since their statements as were given during the investigation do not amount to confession, they both can be allowed to cross-examine but not against their wish.
17. In the light of entire above discussions, we are of the opinion that the Adjudicating Authority has committed no error while denying the opportunity of cross examination of investigating officers and the panch witnesses. As a result, we uphold the order under challenge and consequent thereof, the appeal stands dismissed.
(Pronounced in the open Court on 31.03.2022 ) (P V SUBBA RAO) MEMBER (TECHNICAL) ( RACHNA GUPTA ) MEMBER (JUDICIAL) ss 11