SWAIKA VANASPATI PRODUCTS LTD Vs. COLLECTOR OF CENTRAL EXCISE
CUSTOMS EXCISE AND GOLD(CONTROL) APPELLATE TRIBUNAL
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K. Sankararaman, Member (T) -
(1.) HEARD Shri Prasenjit Basu, learned Advocate for the applicants. He submitted at the outset that there was patent violation of natural justice in the adjudication of the case. The case has been made out on the basis of certain seized records and statements of some of their officers. They had repeatedly requested for an opportunity to be given to them for cross-examination of the said officers of theirs to enable them to explain the matter properly. Even on the day of the personal hearing they had given a letter to the Collector with a submission, wherein also they had reiterated their request for the opportunity of cross-examination. This was denied to them. The Collector had observed in his order "it was pointed out to them that they had already made their submissions in their reply to the show cause notice taking into consideration the statements made by the concerned officers and hence there is no need for cross-examination which would only delay the matter without any improvement in the result whereupon they did not press the issue further." The denial of the opportunity to cross-examine the Officers has seriously affected their defence. The observation of the Collector in the order that such cross-examination was not necessary as they had already given their reply to the show cause notice taking into consideration the statements of their Officers and that such cross-examination would only delay the matter without any improvement in the results shows that the Collector had a closed mind. He cannot say that the cross-examination would not improve their defence, submitted the learned Counsel. He also referred to the observation of the Collector in his order that the statements relied in the show cause notice have evidentiary value and any statements made subsequently in contradiction to these can only be considered an afterthought and given under advice of the vested interests. This again shows his closed mind. The counsel, therefore, pleaded that in view of this position, stay may be granted. He also submitted that in view of the point regarding denial of natural justice raised by him the appeal itself be decided. He handed over a copy of an unreported judgment of the Tribunal, where the order appealed against was set aside and the matter remanded for de novo adjudication.
(2.) Shri A. Choudhury, learned Departmental Representative appearing on behalf of the respondent Collector opposed the arguments. He pointed out that when the Collector during the hearing had made his observation about there being no need for the cross-examination they had reportedly not pressed the issue further. Therefore, it is clear that they had dropped their request for personal hearing. Such being the case, it is not open to them to say that they had been denied the opportunity to cross-examine their officers whose statements had been relied upon in the show cause notice. After all they were their own officers and they could have produced them for examination as witnesses. There is no denial of natural justice in the given circumstances of this case. The Collector had considered their reply and given a finding. The stay may not be granted.
We have considered the submissions made by both the sides. We find that the applicants had been pressing for the grant of opportunity to cross-examine their Officers whose statements had been made use of in interpreting the entries in the seized records and working out the unaccounted clearances on which duty had been demanded. The request made by them was quite reasonable. Even on the day of the hearing, they had given a letter wherein they had, inter alia, reiterated their request regarding cross-examination. No doubt, the Collector had recorded in his order that they did not press the point further. This has been taken as their acquiescence in the matter and waiver of their right of cross-examination. In the present appeal and Stay proceedings, they appear to have resiled from their previous stand as recorded by the Collector and raised the plea of denial of natural justice contending that the Collector had already made up his mind that the cross-examination would not serve any useful purpose. The applicants had not waived their right of cross-examination suo motu enabling the Collector to move ahead. It is in response to his remarks in the course of the hearing that they are reported to have not pressed the point further. In these circumstances their not pressing the point is not the same as their voluntary waiver of their legal rights. Moreover, irrespective of their response or rather lack of response, the Collector's observation to the effect that the cross-examination would not serve any useful purpose definitely smacks of a predetermined approach on his part with a closed mind. The plea made by the learned Counsel in this regard is acceptable. In the majority decision dated 25-7-1989 of the North Regional Bench in Chandra Industries, Jalandhar v. Collector of Central Excise, Chandigarh in Appeal No. E 1627 of 1986, which is as yet unreported, it was held that serious prejudice was likely to be caused to the appellants if they were not given the opportunity to cross-examine the persons whose statements were relied upon by the department. The fact that in the present case the statements of the Officers of the applicant company had been made use of in interpreting the entries in the seized records and allegations raised. When the request was made for cross-examining them to elicit full information to put the matter in proper perspective and emergence of the correct position, it should not have been difficult for the Collector to have allowed the request. Rather, it was essential in the interests of justice and fair play. His further observation in the impugned order that any statements made subsequent to the original statements in contradiction to the latter can only be considered an after-thought and given under advice of vested interests, is a generalisation which may not be true in all cases. It was certainly open to him after providing the opportunity to the concerned persons to give further statements, and give his finding as to which statements in the given circumstances were reliable and proceed accordingly. The course adopted by him has left the applicants with the justifiable grievance that they had not been given the necessary opportunity to submit their defence explaining the records properly.
(3.) FOR the foregoing reasons, we allow the Stay Petition. We waive predeposit of penalty and duty.;
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