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M/s. Nitish Tools Pvt. Limited Versus Customs, Central Excise & Service Tax, Settlement Commission, The Commissioner of Central Excise, The Commissioner of Customs

2015 (8) TMI 531 - MADRAS HIGH COURT

Settlement of case – True and full Disclosure – Petitioner challenges order passed by respondent-1 by which, applications seeking immunity by way of settlement of disputes, came to be dismissed on ground of failure of petitioners to make full and true disclosure of duty liability under Section 127(B)(1) – Held that:- fundamental requirement of application under Section 127-B was full true and candid disclosure by applicant of liability to pay duty which was not disclosed before proper officer – .....

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– Petitioners have not failed to make true and full disclosure of their duty liability in their applications, but have also failed to provide required co-operation to Bench to settle case in true spirit of settlement –Therefore, considering facts and circumstances of case and more particularly, lack of co-operation on part of petitioners for settlement of their case, Commission has rightly held that it was fit case for sending it back to original authority for disposal in accordance with law –D .....

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under Section 127(B) of the Customs Act, 1962 (in short, the Act ), in and by which, the applications filed by the petitioners seeking immunity by way of settlement of the disputes arose out of show cause notice, dated 13.4.2013, came to be dismissed on the ground of failure of the petitioners to make full and true disclosure of duty liability under Section 127(B)(1) of the Act. 2. The brief facts, necessary for disposal of the writ petitions, are as follows: 3. The Director of Revenue Intellige .....

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so unaccounted currency notices of ₹ 50 lakhs and the Officers of Tuticorin Customs seized one consignment of carbide tips and hollow drill rods valued at ₹ 1,08,75,425/- which were imported by M/s.SSE vide Bill of Entry 7086043, dated 12.6.2012 on 16.7.2012. After completion of investigation, the petitioners were issued show cause notice dated 13.4.2013. The Central Board of Excise and Customs, vide order, dated 28.3.2014, assigned the adjudication of the entire show cause notices w .....

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rom prosecution and penalty. 4. According to the petitioners, in their absence, the documents recovered from the laptop by engaging the service of an expert; the imported tools were made from recycled materials on which 20% discount was available; the imported goods having been manufactured at cottage industries from where most of the import was made were bound to have slight manufacturing defects and the same are sold as seconds at throw way discounted prices; for lack of demand for a long time .....

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t have also failed to provide required co-operation to the Bench to settle the case in a true spirit of settlement. Therefore, the Bench, by virtue of powers vested in it in terms of Section 127-I(1) of the Act, 1962 sent the case back to the Commissioner of Customs for adjudication in accordance with provisions of the Act. The Bench had observed that the Commissioner would decided the case as if no application for settlement had been filed by the petitioners. Challenging the same, the respectiv .....

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ation of carbide tips, they came up with a new hypothetical theory that the goods imported by them were of inferior quality, but there is no scientific proof that the cemented carbide could also be inferior in quality. The petitioners have accepted their liability only to the extent of ₹ 2 Crores which is only 11.89% of their actual duty liability of ₹ 16.82 Crores demanded based on documentary evidence. Having the petitioner approached the Settlement Commission to settle the case, i .....

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ure of the facts relating to undervaluation and also the registration of the case by CBI on them and thus, sought for dismissal of the application. The Settlement Commission vide its letter, dated 28.8.2014 asked the petitioners to give their comments about the maintainability of the application. The petitioners, by letter dated 9.8.2014 replied that CBI had issued summons after the filing of the application before the Settlement Commission and the case is not pending before any other Court and .....

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date fixed for the hearing, sent a letter dated 10.11.2014 stating that he is taking treatment for chronic spondilities and sought for adjournment by six weeks. There is no difficulty for the petitioners in appearing on the said date, but their counsel alone had difficulty. However, at the instance of same, the Commission adjourned the case by fixing the date of hearing on 4.12.2014. On 1.12.2014, the petitioner in W.P.No.2837 of 2015 sent a letter that she is not in a position to attend the per .....

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the facts and had not come clean before the Commission. When the next hearing was fixed on 19.12.2014, they requested for postponement for the first time on the pretext of non-receipt of un-relied upon documents which were not relied upon by the department for issuance of the show cause notice. Therefore, the Commission decided to proceed with the case, stating that it appears that the applicant is not keen on settling the dispute, rather, they seem to delay their liability to pay government due .....

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nities to the petitioners and the petitioners alone had failed to utilize the same and the Commission has given categorical finding that the petitioners have not made true and full disclosure of the facts and they have not co-operated for settling the case before the Commission. The said finding is supported by valid records which are evident in the impugned order itself. A finding of fact and the decision of the Settlement Commission is not amenable to writ jurisdiction. The Settlement Commissi .....

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an application, before adjudication to the Settlement Commission to have the case settled, in such form and in such manner as may be specified by rules, and containing a full and true disclosure of his duty liability which has not been disclosed before the proper officer, the manner in which such liability has been incurred, the additional amount of customs duty accepted to be payable by him and such other particulars as may be specified by rules including the particulars of such dutiable goods .....

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The application has to contain a full and true disclosure of the duty liability of the importer which has not been disclosed before the proper officer, the manner in which such liability has been incurred, the additionalamount of customs duty accepted to be payable by him and such other particulars as may be specified by rules including the particulars of such dutiable goods in respect of which he admits short levy on account of mis-classification, under-valuation or inapplicability of an exempt .....

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, it is the specific case of the respondents that the petitioners have accepted their liability only to the extent of ₹ 1,98,33,832/- which is only 11.89% of their actual duty liability of ₹ 16.82 crores demanded by the department based on the documentary evidence. The specific case of the petitioners is that the set of relevant documents recovered from their laptop on 01.02.2012 by the department were not furnished in order to substantiate their case. It is not in dispute that the d .....

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petitioners sought for furnishing of the documents. By the time, the petitioners were admittedly given sufficient opportunities to come up with true and full disclosure of their liability, however, right from the inception, as could be seen from the record, it appears that the petitioners have been dodging the matter without participating in the settlement proceedings. As seen from the record, it appears that the Settlement Commission vide its letter, dated 28.8.2014 asked the petitioners to giv .....

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eply after receiving the report of the Department. Thereafter, the Settlement Commission fixed the final hearing of the application and posted the case on 13.11.2014. The notice was sent on 23.10.2014 and the counsel for the petitioners, just three days before the date fixed for the hearing, sent a letter dated 10.11.2014 stating that he is taking treatment for chronic spondilities and sought for adjournment by six weeks. There is no difficulty for the petitioners in appearing on the said date, .....

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ers sent another letter dated 14.12.2014 stating that she is yet to get documents from DRI and therefore, again sought for adjournment. Therefore, it shows that the petitioners are not interested in settling the issue at an early date as they had not disclosed all the facts and had not come clean before the Commission. When the next hearing was fixed on 19.12.2014, they requested for postponement for the first time on the pretext of non-receipt of un-relied upon documents which were not relied u .....

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