Home Case Index All Cases Service Tax Service Tax + HC Service Tax - 2016 (1) TMI HC This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2016 (1) TMI 928 - HC - Service TaxService Tax Dispute - Settlement Commission rejected the application - The Petitioners say that since they had accepted that there was a short payment of service tax and interest, in addition to filing periodical returns as required, the Petitioners approached the Settlement Commission for a settlement of the dispute - The Settlement Commission purported to note that the Petitioners did not have sufficient supporting documentation. Held that:- Settlement Commission has plenary powers to summon and take evidence. If there was any doubt about this, it is completely set at rest by the plain wording of Section 32-L(2) which speaks specifically of the Central Excise Officer being entitled to use all the materials and information produced by a petitioner before the Settlement Commission, “or the result of the enquiry held or evidence recorded” by the Settlement Commission in the course of proceedings before it “as if such materials, information, enquiry and evidence had been produced before such Central Excise Officer or held or recorded by him in the course of proceedings before him”. For the Respondents to say, therefore, in paragraph 2 that the Settlement Commission is “not a forum for evaluating evidence or deciding a matter involving complicated issues of facts and law” is clearly incorrect. We will assume for the purpose of this Petition that a copy of the Revenue’s report was in fact made available to the Petitioners. We find, however, that the Petitioner was given no opportunity of meeting it. The Settlement Commission seems to have straightaway accepted that Report not only as gospel, but as totally incontrovertible, and incapable of being subjected to any rational settlement. There is absolutely no basis for this, other than the Settlement Commission saying, to all intents and purposes, that the matter is apparently too onerous and too taxing on the Settlement Commission’s time, energy and resources. This is wholly unacceptable. The very least the Settlement Commission ought to have done, in our view, was to give the Petitioner an opportunity to respond to the Revenue’s observations and Report. Had the Petitioners then failed to do so, or if, on a close examination, that response was found on merits to be without substance, the application could have been dealt with accordingly. But to deny that opportunity and to thereby short-circuit a properly brought Settlement Case in this fashion is not, in our view, in keeping with the statutory mandate at all. We are satisfied that there has been a fatal violation of the principles of natural justice. We are also satisfied that the Settlement Commission has not proceeded in accordance with its statutory mandate under Chapter V of the CEA. We specifically reject and repeal the reason given by the Settlement Commission that it cannot take evidence or that, when confronted with conflicting submissions on facts and law, its only recourse is to dismiss a settlement application brought before it. Nothing could be further from the statutory intent. The Petition succeeds in part. - Matter restored before the Settlement Commission for a fresh consideration.
|