Commissioner Of Central Excise v. M/S Hindustan Polyster Lines

IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH. Case No. : C. E. A. No. 59 of 2007Date of Decision : October 31, 2008. Commissioner of Central Excise Vs. M/s Hindustan Polyster Lines ....Appellant....Respondent CORAM : HON'BLE MR. JUSTICE ADARSH KUMAR GOEL HON'BLE MR. JUSTICE L. N. MITTAL * * * Present :Mr. Kamal Sehgal, Advocatefor the revenue. Mr. C. Hari Shankar, AdvocateMr. S. Sunil, Advocateand Mr. Suman Jain, Advocatefor the assessee. * * * ADARSH KUMAR GOEL, J. (Oral) : 1.Commissioner of Central Excise has preferred this appeal underSection 35-G of the Central Excise Act, 1944 against order dated22.08.2006 passed by the Customs, Excise and Services Tax AppellateTribunal, New Delhi.2.Substantial questions of law sought to be raised are :-“(i)Whether the Tribunal was justified or not inremanding the case back to theCommissioner ? (ii)Whether cross-examination of the witnessesin the absence of any prejudice isjustified or not ? (iii)Whether the denial of cross-examination ofwitnesses has violated the principlesof natural justice ?” 3.Revenue raised a demand against assessee on the ground ofclandestine removal of goods without payment of excise duty. 4.On appeal to the Tribunal, it was found that opportunity tocross-examine witnesses was not given to the assessee, for which purposethe assessee was directed to appear before the Commissioner on 25.09.2006and matter was remanded to the Commissioner. 5.The Tribunal also noticed the contention raised on behalf of theassessee that adjudication proceedings were concluded without givingopportunity to the assessee of cross-examination of the witnesses, whosestatements were recorded at the back of the assessee. The assessee wasproceeded against ex-parte, while the assessee was not aware of the date ofhearing. It was observed that it was in the interest of justice to grant anopportunity to the assessee. 6.Though the tax authorities are not bound by technical rules ofevidence, principles of natural justice are required to be followed, whichrequire that the assessee is given the opportunity to cross-examine thewitnesses, if so warranted by the facts. InState of Kerala vs. KT ShaduliGrocery dealer, (1977) 2 SCC 777, the Hon'ble Supreme Court observed : “4......It is, therefore, not possible to saythat in every case the rule of audi alteram partemrequires that a particular specified procedure is tobe followed. It may be that in a given case the ruleof audi alteram partem may import a requirementthat witnesses whose statements are sought to be relied upon by the authority holding the inquiryshould be permitted to be cross-examined by theparty affected while in some other case it may not.The procedure required to be adopted for giving anopportunity to a person to be heard mustnecessarily depend on facts and circumstances ofeach case..... 5......It can hardly be disputed that cross-examination is one of the most efficacious methodsof establishing truth and exposing falsehood.....” 7.The Tribunal having given the assessee an opportunity ofcross-examination, on facts of the case, we do not find any ground to holdthat such a view was liable to be interfered with in appeal under Section 35-G of the Act, which lies only on substantial questions of law.8.We find that the impugned order was passed two years ago. Nostay was sought or granted. Still, the Commissioner has failed to carry outthe direction of the Tribunal, by which the Commissioner was bound, onlyon pretext that appeal was filed. Such conduct of the Commissioner canhardly be appreciated. 9.The appeal is dismissed. (ADARSH KUMAR GOEL)JUDGE October 31, 2008monika ( L. N. MITTAL ) JUDGE