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2024 Supreme(Online)(Mad) 76454
IN THE HIGH COURT OF JUDICATURE AT MADRAS
C.Saravanan, J
Annai Poly Packs – Appellant
Versus
The Deputy Director, Directorate General of Central Excise Intelligence – Respondent
W.P.(MD)Nos.5447 and 5501 of 2018
For the Appellants/Petitioners: Mr.R.Venkataraman, Mr.M.Jegadeesan
For the Respondents: Mr.R.Nandhakumar, Mr.N.Dilip Kumar
Denial of cross-examination does not invalidate proceedings if statements are corroborative; quasi-judicial authorities are not bound by strict rules of evidence.
Headnote:(A) Central Excise Act, 1944 - Section 2(f), Section 11A, Section 11AC, and Rules 25, 27, and 30 of Central Excise Rules, 2002 - Writ petitions challenging the impugned orders confirming demand of duty and penalties against two firms owned by the same proprietor - Court upheld the clubbing of clearances of both firms and found no violation of natural justice despite the petitioners' claims for cross-examination. (Paras 3, 16, 22, 24)
(B) Natural Justice - Cross-examination - Denial of cross-examination does not automatically vitiate proceedings if the statements relied upon are corroborative and not solely determinative of the outcome. The court maintained that the quasi-judicial authority is not strictly bound by the rules of evidence. (Paras 12, 20, 21)
Facts of the case:
The petitioners challenged orders confirming duty and penalties for the clubbing of clearances of two firms owned by the same individual, claiming violations of natural justice due to denial of cross-examination. (Paras 2, 4)
Findings of Court:
The court dismissed the writ petitions, allowing the petitioners the opportunity to appeal against the orders before the Commissioner of Central Excise (Appeals). (Paras 24, 29)
Issues: The primary issue was whether the refusal to allow cross-examination constituted a violation of natural justice affecting the validity of the orders. (Paras 6, 16)
Ratio Decidendi: The court ruled that cross-examination is not required if the statements are corroborative and not solely relied upon for the decision. The authority's reliance on the overall evidence was upheld. (Paras 20, 21)
Result: Writ petitions dismissed with liberty to appeal.
| Table of Content |
|---|
| 1. petitioners challenge orders confirming duty demands. (Para 1 , 2 , 3) |
| 2. request for cross-examination not granted. (Para 4 , 5 , 6) |
| 3. statements recorded, no direct reliance on witnesses. (Para 7 , 8 , 9 , 10) |
| 4. court considers arguments and statements made. (Para 11 , 12 , 13 , 14 , 15) |
| 5. cross-examination not required if based on corroborative evidence. (Para 16 , 17 , 18 , 19 , 20) |
| 6. court dismisses petitions, allowing appeal process. (Para 21 , 22 , 23) |
| 7. writ petitions dismissed with liberty to appeal. (Para 24 , 25 , 26 , 27 , 28 , 29) |
COMMON ORDER
By this common order, both these Writ Petition are being disposed of.
2. In these Writ Petitions, the petitioners have challenged the impugned Order-in-Original No.MDU-CEX-COM-07 & Order-in-Original No.MDU- CEX-COM-08 dated 22.12.2017 passed by the fifth respondent Commissioner of CGST & Central Excise.
3. By the impugned orders, the fifth respondent has confirmed the demand proposed in Show Cause Notice No.01/2016-CE dated 01.01.2016 and Show Cause Notice No.33/2017-CE dated 04.04.2017. Operative portion of the impugned orders dated 22.12.2017 reads as under:-
ORDER
(i) I treat both the firms M/s Annai Poly Packs, registered in the name of Shri. M.Ahamed Ibrahim, and M/s.Banu Poly Packs registered in the name of Smt.Fatima Banu, wife of Shri.M.Ahamed Ibrahim as single manufacturer for the purpose of commuting the Central Excise duty as the proprietor of M/s Annain Poly Packs, who has all control over of both firms and manufacturing and a clearing PP/HM Sheets and Bags from the said two factories in terms of Section 2 (f) of Central Excise Act 1944 (which defines "manufacturer") read with condition nos. 2(v) and 2(vii) of the SSI Exemption Notification No. 8/2003-CE dated 01-3-2003 as amended.
(ii) I confirm the clubbing of the value of clearances of PP/HM Sheets and Bags that have been manufactured by both M/s Annai Poly Packs and M/s Banua Poly Packs for the period from January 2012 to June 2014 and from July, 2015 to May 2016, whose past records appeared to have been destroyed, now determined to the extent of their power consumption using per-unit-average-production calculated from their private records and in terms of condition nos. 2(v) and 2(vii) of SSI Exemption Notification No.8/2003-CE dated 01.3.2003, as amended, for the reasons set out above to determine the aggregate value of clearances for demanding duty from Shri M.Ahamed Ibrahim, the proprietor of M/s.Annai Poly Packs.
(iii) I confirm confiscation of 9852.51 kgs of Poly Bags, valued at Rs. 12,80,826, under Rule 25 of the Central Excise Rules, 2002, kept ready for clearance without payment of duty which were seized from M/s. Annai Poly Packs and subsequently released provisionally.
(iv) I confirm confiscation of 5968.70 kgs of Poly Bags and HM Bags. valued at Rs.6,24,346/-, under rule 25 of the Central Excise Rules, 2002, kept ready for clearance without payment of duty which were seized from M/s. Banu Poly Packs intent to clear along with bags manufactured at App without bills.
(v) I impose a redemption fine of Rs.1,28,083/- (Rupees One lakh twenty eight thousand and eighty three only) in lieu of confiscation under Rule 30 of the Central Excise Rules, 2002 on Shri.M.Ahamed Ibrahim, proprietor of M/s.Annai Poly packs as the seized goods have already been provisionally released.
(vi) I impose a redemption fine of Rs.62,435/- (Rupees Sixty two thousand four hundred and thirty five only) in lieu of confiscation under Rule 30 of he Central Excise Rule, 2002 on Smt.A.Fathima Banu. proprietor of M/s.Banu Poly packs as the seized goods have already been handed over under Form of undertaking.
(vii) I confirm an amount of Rs.2,61,31,886/- (Rupees Two Crore Sixty One Lakh Thirty One Thousand Eight hundred and Eighty Six only) (Rs. 2,56,82,732/- Central Excise duty, Rs.2,99,436/- Educational Cess and Rs.1,49,718/- S&H Education Cess) payable on the total value of (i) the despatches of PP/HM Sheets and Bags found rec
