2026-VIL-1870-CESTAT-AHM-CU
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CUSTOMS CESTAT Cases

Customs - Undervaluation of imported second hand knitting machines - Violation of principles of natural justice - Appellant imported second hand knitting machines. On intelligence of misdeclaration and undervaluation, DRI searched the premises and issued SCN proposing rejection of declared value, demand of differential duty with interest, confiscation and penalties. The Adjudicating Authority rejected the declared value, confirmed the demand, confiscated the machines with option of redemption fine and imposed penalties. The FAA upheld the order. The Appellant contended that it was denied inspection of the original import file and cross-examination of the Chartered Engineer and other persons whose opinion was relied upon, and that the Chartered Engineer certificate supporting the declared value was not considered - Whether the order is vitiated for violation of principles of natural justice on account of denial of copy of the original import file and of cross-examination of the department's witnesses - HELD - Where a request for cross-examination is rejected without giving proper reasoning, the order is treated as passed in violation of the principles of natural justice. The Adjudicating Authority did not deal with the request on merits. It brushed aside the request for the import file by stating that original documents are never supplied by the importer to the department. It rejected cross-examination on the footing that the statements of the Appellant's proprietor admitted the position and that cross-examination would only delay adjudication. The FAA also turned down the request without any discussion. The Appellant was thereby deprived of an effective opportunity to defend the case. Without going into the merits, the impugned order cannot be sustained - The order is set aside, the Adjudicating Authority is directed to provide the copy of the original import file and afford the opportunity to cross-examine the Chartered Engineer, and to decide the case afresh keeping in mind the CBIC Circulars on valuation of second hand machinery - The appeal is allowed by way of remand
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