Custom, Excise & Service Tax Tribunal
(I) M/S. Haripriya Traders vs Commissioner Of Customs on 27 June, 2013
IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL, BANGALORE SOUTH ZONAL BENCH COURT - I Stay Application No. C/Stay/1832 to 1835/2012 in Customs Appeal No: C/2506 to 2509/2012 (Arising out of (i) Order-in-Original No: 7/2012 dated 30.8.2012; (ii) Order-in-Original No: 8/2012 dated 27.8.2012; (iii) Order-in-Original No: 9/2012 dated 27.8.2012 & (iv) Order-in-Original No: 10/2012 dated 30.8.2012 all passed by the Commissioner of Customs, Cochin.) (i) M/s. Haripriya Traders (ii) M/s. P.K. Traders (iii) M/s. Shabeer Enterprises (iv) M/s. Mohammed Fariz & Co. Appellants Versus Commissioner of Customs, Cochin. Respondent
Appearance Mr. C.K. Karunakaran, Advocate for the appellants.
Ms. Sabrina Cano, Superintendent (AR) for the Revenue.
CORAM SHRI B.S.V. MURTHY, HONBLE MEMBER (TECHNICAL) DR. D.M. MISRA, HONBLE MEMBER (JUDICIAL) Date of Hearing: 27.06.2013 Date of decision: 27.06.2013 FINAL ORDER No._______________________2013 [Order per: B.S.V. Murthy]. We are considering the four stay applications and appeals together in view of the fact that in all the cases, the issue involved is same even though different orders have been passed and different bills of entry are involved. For considering these stay applications and appeals, we take up Stay Application No.1832/2012 and Appeal No.2506/2012.
2. Appellants imported four consignments of betel nuts from Indonesia covered by four bills of entry filed during the period March to June, 2008 and the declared value was USD 250 per MT in respect of bills of entry and the total quantity involved was 180.08 MTs. Investigation was commenced on the ground that the declared value was low and after initiation of proceedings and adjudication process, an order was passed enhancing the value to 1100 USD per MT which was challenged by the appellants before this Tribunal in the first round of litigation. One of the grounds taken in the appeal while challenging the order-in-original was that the conclusion to enhance the value was arrived at on the basis of the report from the First Secretary (Commerce), Singapore High Commission. Appellants submission was that the report could not have been relied upon. The Tribunal while remanding the matter for fresh adjudication to the original authority made an observation in para 7.1 that such report can be relied upon. Against this observation, the appellants approached the Honble Supreme Court and Honble Supreme Court in their order in civil appeal No.8383/2012 dated 12.12.2012 held that the observations made by the Tribunal in para 7.1 are not correct and the remand should have been an open one. There was no stay against the remand order passed by the Tribunal by the Honble Supreme Court. Before the final order of the Honble Supreme Court was received, the impugned order was passed which is in the nature of interim order wherein the Commissioner took the view that he is competent to adjudicate the case and he need not recuse himself. This is again because, by the time fresh adjudication was taken up after remand order was passed, the First Secretary (Commerce), Singapore High Commission who had sent the report which formed the basis for the investigation, was posted as Commissioner and became the adjudicating authority. At this stage, the appellants contended that since the whole order was based on his report, he was not competent to adjudicate the matter. The impugned order has been passed dealing with the preliminary objection raised by the appellants that the person as adjudicating authority cannot adjudicate the matter since the order in the first round of litigation by the original adjudicating authority had been passed relying upon his report. The appellants are seeking stay of this order.
3. After hearing both sides for some time, we have reached the conclusion that instead of granting stay at this stage, it would be more appropriate to dispose of the appeal itself since the only issue involved is whether the adjudicating authority is competent to adjudicate the matter or not. Accordingly, we take up the appeal itself for final decision with the consent of both sides.
4. The learned advocate on behalf of the appellants submitted that they had filed an application under RTI Act to the Singapore High Commission seeking a copy of the letter of the Commissioner of Customs, Cochin addressed to the High Commissioner; copy of the documents based on which the First Secretary (Commerce) had communicated the value per metric tone of betel nut and note sheets of the relevant file. The PIO had rejected the application on the ground that legally he was not bound to provide the documents/ information, as the documents sought by the appellants fell within the purview of Sections 24(1) and 8(f) of the RTI Act, 2005. On an appeal filed by the appellants against this order, the competent appellate authority passed another order wherein he overruled the observations regarding non-liability for providing the documents and thereafter went on to observe that there was no document available to be furnished in the High Commission, which was sought by the appellants. The order was passed by the First Appellate Authority on 17.8.2012 and this order along with enclosures was submitted to the Commissioner by the appellants on 9.9.2012. However, the Commissioner had already passed the impugned order on 30.8.2012. While submitting copy of this order of the First Appellate Authority under RTI Act, 2005, the appellants had sought cross-examination of the person adjudicating in his personal capacity since he had sent report as First Secretary (Commerce), Singapore High Commission besides contesting the findings based on the report. However, there could not be any observations on this issue because by this time adjudicating order (interim) had been passed. The learned counsel submits that since the whole order was passed on the basis of the report and the report as per information received under RTI Act was not based on any document or basis and at this stage the only person who could clarify this is the person who had sent the report. It would be appropriate if the person as adjudicating authority is directed not to adjudicate the matter so long as he occupies the post of adjudicating authority in this case. He also reiterates his submission that the First Secretarys report should not have been relied upon at all since no basis or details were given. He also submits that appellants are making a specific prayer and a direction by the Tribunal to the CBEC to make alternative arrangement for adjudication of the matter by a different person who had not sent the report in the first place.
5. The learned AR defends the stand taken by the adjudicating authority. She submits that the appellants had never requested for cross-examination of the First Secretary (Commerce), Singapore High Commission. Further, she also submits that the contentions of the appellants that the entire adjudication order enhancing the value was only on the basis of the report of the First Secretary (Commerce), Singapore High Commission, is not correct and she draws our attention to the specific paragraphs to show that there were other evidences which were taken into consideration. However, this was countered by the learned counsel for the appellants by reading out the conclusive paragraph in the findings wherein the value was enhanced to USD 1100 per MT. While doing so, the Commissioner had cited the report of the First Secretary only.
6. We have considered the submissions made by both the sides. First of all, the order-in-original was passed in the first round of litigation on 17.5.2010 and the matter travelled up to Supreme Court and finally again the adjudicating authority had to take up adjudication. In the meanwhile the appellants were pursuing the matter under RTI Act to get the information relating to the issue from Singapore High Commission. The application to Singapore High Commission was made nearly two years after the adjudication order was passed i.e., 8.6.2012 which was rejected on 5.7.2012. Thereafter the appellate order under RTI Act was passed on 17.8.2012. However, when the adjudicating authority in the second round of litigation took up the matter, the fact that such applications were made and an appellate order had already been passed under RTI Act was not brought to the notice of the adjudicating authority at all, when the personal hearing took place. It is relevant to note that personal hearing was granted on 8.8.2012 when the appeal filed by the appellants under RTI Act was pending. Thereafter we are not able to make out on what date the appellate order was received. However, as per the facts on record, it was on 7.9.2012 that the appellants for the first time made a request for cross-examination of the adjudicating authority who was the First Secretary (Commerce). This request was not made at the time of passing of the order-in-original on 17.5.2010 even though it was the appellants contention that the report of the First Secretary (Commerce) cannot be relied upon. In fact nothing could have prevented or should have prevented the appellants from seeking the cross-examination of the First Secretary (Commerce) if they intended to do so in the first round of litigation itself, since appellants knew that there was a report and that had been mentioned in the show-cause notice also. Therefore, the submission that the First Secretary (Commerce) should be cross-examined before the adjudication process is completed cannot be accepted. This request is liable to be rejected and accordingly rejected.
7. Coming to the second issue i.e., whether the person as adjudicating authority could have adjudicated the matter being the First Secretary (Commerce) who had sent the report in the first place, we observe that it is quite common and happens often that the same officer who had issued the show-cause notice or who is part of the investigations also adjudicates the matter. Even though both sides have not produced any decisions, it is clear that there is no bar for adjudication of a matter by the adjudicating authority even if he had some role to play at the time of investigation or in the issue of show-cause notice. What is required to be seen is that there is no bias while passing the order. Further, we also find that the submission made by the learned AR that the person adjudicating in his capacity as First Secretary (Commerce) was not part of the investigation and cannot be considered to be an investigating officer is correct. He had only responded to the query from India about the prices of betel nuts and had sent a report. Therefore, it cannot be said that he was part of the investigation. Therefore, this ground also we are unable to accept. Therefore, we have to reject the appeals filed by the appellants challenging the impugned orders wherein the Commissioner has refused to recuse himself as required by the appellants to participate in the adjudication.
8. Having come to the conclusion, which is mainly based on law as we have understood, we still leave it to the judgment of the present Commissioner whether he should adjudicate the matter or refer the matter to the Board to appoint another adjudicating authority after considering the issues involved and also the appellate order in respect of the applicant made under RTI Act, 2005 which would show that the Singapore High Commission had no documents and is unable to provide the basis on which the report was sent by the First Secretary (Commerce). Since the letter is dated 7.9.2012 and was received by the adjudicating authority after he had passed the order, we take note of the fact that this vital fact was not before him when he came to the conclusion that he need not recuse himself.
9. The stay applications and appeals are rejected.
(Pronounced and dictated in open Court) (D.M. MISRA) Member (J) (B.S.V. MURTHY) Member (T) rv 9