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2022 (7) TMI 715 - BOMBAY HIGH COURTClandestine Removal - suppression of production of processed fabric - imposition of penalty by Settlement Commission - HELD THAT:- This court is not court of appeal but this court in its jurisdiction under Article 226 is entitled to consider whether the Authority has exercised its discretion correctly. Whether to impose penalty and to what extent is purely discretionary order and we would not in normal circumstances, interfere with such discretionary order. It is true that a party will approach a Settlement Commission and has to either accept the opinion of the Settlement Commission in its entirety or not accept but when the Settlement Commission has exercised its discretion to impose penalty of Rs. 10,00,000/-, we would have expected the Settlement Commission to at least give some reasons, if not, very elaborate detailed reasons to indicate why it had imposed penalty of Rs. 10,00,000/-. This is particularly in view of the fact that the Settlement Commission has, in the impugned order, appreciated the conduct of petitioner and held that petitioner’s claim for duty benefit was well founded and petitioner had made full and true disclosure of its duty liability, that petitioner has already deposited the admitted amount and co-operated with the Settlement Commission in the proceedings before it. The Settlement Commission has also concluded that petitioner was entitled to cum duty benefit and settled the case at Rs. 57,49,970/- as against the demand made by the department of Rs. 69,63,995/- and it was petitioner’s case that only Rs. 54,89,101/- was payable and the petitioner had already deposited that amount. With such a background simply saying “Bench grants immunity from penalty to the applicant in excess of Rs. 10,00,000/-, will not suffice. Right to reason is an indispensable part of sound judicial system. Reasons, at least sufficient to indicate an application of mind or the rationale in imposing penalty, should be given in the order. It is also not the case of respondents that petitioner was a habitual offender. The impugned order passed by the Settlement Commission to the extent of imposing the penalty of Rs. 10,00,000/-, needs to be interfered - petition disposed off.
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