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M/s SSF Plastics India Pvt Ltd, Mr. Ramesh Chugh Versus The Union of India, The Commissioner of Central Excise Customs And Service Tax, Daman

2015 (8) TMI 248 - BOMBAY HIGH COURT

Validity of decision of settlement commission - Scope of section 32-E and 32-F(2) - Settlement commission closed the proceedings - Settlement Commission has found that the applicant-petitioner has not made full and true disclosure of the duty liability and the computation and calculation of the same is not in order - Under Valuation of goods - actual amortization cost of moulds was not included into the assessable value for payment of excise duty.

Held that:- Settlement Commission oug .....

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h the liability has been derived, the additional amount of excise duty accepted to be payable and such other particulars as may be prescribed and set out in sub-section (1) of section 32-E

Matter proceeded upto sub-section (4) of section 32-F of the Central Excise Act, 1944. There are certificates which have been obtained and placed on record by both the appellant-petitioner and the Revenue. The Revenue faults the contents of that certificate and by raising several pleas. However, the .....

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out going into a lot of details of the disputes as far as the methodology is concerned.

If the Revenue is not accepting the certificate or the lower amount, the Bench is then not handicapped and just cannot fold its hands in cases like the present one. It is not a dismissal based on a conclusion that the disclosure is not full and true. If it was indeed not so, there was no occasion for issuing further directions and to permit parties to examine certificates and equally the Revenue to .....

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over-emphasize this aspect. - matter restored before the Settlement Commission - Decided in favour of assessee. - Writ Petition No. 2870 of 2014 - Dated:- 27-7-2015 - S. C. Dharmadhikari And G. S. Kulkarni,JJ. For the Appellant : Ms Padmavati Patil For the Respondent : Mr Pradeep S Jetly JUDGMENT [Per S C Dharmadhikari, J. ] 1. We have heard both sides and with their assistance perused the Writ Petition and all annexures thereto. With the consent of both sides, we dispose of this Writ Petition .....

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they clear the goods on payment of central excise duty. The petitioners are using moulds as raw materials for the purposes of manufacturing their final product and they are taking cenvat credit. The petitioners final product is used as packaging material and the duty paid by the petitioners is availed as cenvat credit by the buyers. However, what the claim of the petitioners is that one of their customers M/s. Hindustan Unilever Limited supplied moulds to the petitioner on lease basis by chargin .....

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from a Cost Accountant. This, according to the petitioners, complies with the Central Board of Excise & Customs Circular dated 23rd January, 1996, They also approached a Chartered Engineer and obtained a certificate. The petitioners received a notice to show cause dated 27th December, 2012, demanding duty in the sum of ₹ 49,90,069/- alleging that the actual amortization cost of moulds was not included into the assessable value for payment of excise duty and there is short payment. 4. .....

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oceeded in terms of section 32-F (1). The Revenue filed a report and objecting to the computations and calculations, including raising an issue about the correctness of the certificates obtained by the petitioners. The matter was fixed by the Settlement Commission before it and on 26th March, 2014. Submissions were canvassed with regard to the Chartered Engineer's certificate. From the record it appears that the Settlement Commission gave time to the Department to examine the Chartered Engin .....

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d with the observation at pages 51 and 52 paragraphs 9.5 and 9.6. The precise submission is that an order has been passed in terms of section 32-F(5) but what the Settlement Commission essentially has done is to reject the application as not admissible in terms of section 32-E of the Central Excise Act, 1944. The fundamental difference between the two sections and the subsections thereof has not been noticed at all. The Settlement Commission could not have concluded the proceedings without compl .....

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de. 8. After hearing both sides we are unable to agree with Mr. Jetly. The Settlement Commission ought to have understood that section 32-E of the Central Excise Act, 1944, deals with application for settlement of cases and by sub-section (1) what the law postulates is a proper application to the Commission to have a case settled. The application must be in such form and must be made in such manner as is prescribed by the Rules. It should contain full and true disclosure of the duty liability wh .....

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on reached the stage and as contemplated by section 32-F. After the application is taken as not deficient but worth admitting what has to be done thereafter is to forward to the applicant, a notice to explain why the application should be allowed to be proceeded and after taking the explanation into consideration the Settlement Commission may allow the application to be proceeded with or reject the application and the proceedings before the Settlement Commission then shall abate on the date of r .....

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obliged to forward this report. After such a report is received, then, how the matter or application should be dealt with is provided by sub-sections (4) and (5) of the said provision viz. Section 32-F. 9. From the record it is very clear that the matter proceeded upto sub-section (4) of section 32-F of the Central Excise Act, 1944. There are certificates which have been obtained and placed on record by both the appellant-petitioner and the Revenue. The Revenue faults the contents of that certif .....

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ch felt that a legal settlement is not possible without going into a lot of details of the disputes as far as the methodology is concerned. We do not see how such a conclusion can be reached and so quickly. If that is the conclusion reached, it was not necessary to have commented upon the conduct of the petitioner and allegedly in not coming up with honest disclosures. It should enable a settlement based on cooperation and disclosures. If the Revenue is not accepting the certificate or the lower .....

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