ORDER :

1. Permission for amendment of appeal(s) is granted.

2. These statutory appeals under Section 130E of the CUSTOMS ACT , 1962 (for short "the Act, 1962”) are at the instance of the Revenue and are directed against the judgment and order passed by the Customs, Excise and Service Tax Appellate Tribunal (for short “the CESTAT”), New Delhi dated 17.04.2018, by which the appeals filed by the respondents-assessees herein came to be allowed and thereby the order in original dated 17.07.2017 passed by the Additional Director General (Adjudication), Directorate of Revenue Intelligence, New Delhi imposing penalty upon the respondents herein came to be set aside.

3. It appears from the materials on record that the respondents herein were engaged in the business of importing branded food items from various countries.

4. After the import of the branded food items, they were being sold in Delhi and Mumbai, respectively. Acting upon the information, the business as well as the residential premises of the respondents were raided, and an extensive search was undertaken by the officials of the department. In the course of various searches, the department was able to procure evidence which prima facie established that the respondents had short paid the duty on the import of the goods in question. The investigation revealed that while filing the Bills of Entry for the imported goods, there was a failure to declare the actual RSP/MRP at which the goods were being sold to the ultimate consumers.

5. Thus, it is the case of the revenue that the importers were thereby declaring lower RSP/MRP, which resulted in evasion of duties.

6. In such circumstances, referred to above, a show cause notice dated 06.06.2016 came to be issued to the respondents, calling upon them to show cause as to why the demand for differential duties of (a) Rs.9,24,50,644/- be recovered from the respondent no.1 and (b) Rs.9,83,614/- be recovered from the respondent no.2, respectively. The show cause notice also called upon the respondents to show cause as to why interest and penalty should not be imposed and the imported goods be confiscated.

7. The show cause notice was adjudicated by the Adjudicating Authority and vide the Order in original dated 17.07.2017, the Commissioner confirmed the show cause notice and thereby raised a demand with interest and penalty. The order in original passed by the Adjudicating Authority came to be challenged before the CESTAT by filing appeals.

8. It appears on plain reading of the entire impugned order that the CESTAT reached the conclusion that the documents relied upon by the department for the purpose of proceeding against the respondents herein could not have been made admissible in evidence, in view of non-compliance of the provision of Section 138C(4)of the Act, 1962. According to the Tribunal, all these documents relied upon by the department were collected from the electronic devices of the respondents and in such circumstances, it was expected of the officials to strictly comply with the provisions of Section 138C(4) of the Act, 1962.

9. The Tribunal, while allowing the appeals filed by the respondents herein, clarified that an argument was canvassed before it on behalf of the respondents herein as assessees as regards Section 138B of the Act, 1962, however, since the Tribunal was inclined to allow the appeals only on the ground of non- compliance of Section 138C(4) of the Act, 1962, it did not deem fit to go into any other issues.

10. Thus, the appeals filed by the respondents before the Tribunal came to be allowed.

11. The Tribunal, while allowing the appeals, made the following observations:-

“11. Upon perusal of the judgment of the Hon'ble Supreme Court in the case of Anvar P.V.(supra), we note that the Apex Court has categorically laid down the law that unless the requirement of Section 65B of the Evidence Act is satisfied, such evidence cannot be admitted. In any proceeding. We note that the Section 138C of the Customs Act is pari mat