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M/s. Sree Sai Enterprises Versus Customs Central Excise & Service Tax Settlement Commission, The Commissioner of Central Excise, The Commissioner of Customs

2016 (6) TMI 822 - MADRAS HIGH COURT

Challenge to the common order passed by the Settlement Commission under the Customs and Central Excise Act - as per the order due to lack of cooperation on the part of the applicant, the matter has to be sent back to the Commissioner of Customs for adjudication. - Held that:- The window given under the Customs Act by inserting chapter XIVA by Finance Act 1998, is to give a reprieve to an applicant who comes forward before the Commission by making full and true disclosure and this Commission was .....

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given by the petitioner is not a straight forward reply, but by stating that pertaining to the show cause notice, which is subject matter of settlement application, no appeal has been filed, is pending before the Appellate Authority or Tribunal or Court and this is the first time, the petitioner has filed the Settlement Application before the forum. The reply given obviously does not answer the specific query in a direct fashion. - The letter dated 18.12.2014, given by the petitioner to the .....

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m, J. For the Petitioners : Mr. A. K. Jayaraj For the Respondents : Mr. A. P. Srinivas Senior Standing counsel ORDER Heard Mr.A.K.Jayaraj, learned counsel appearing for the petitioner and Mr.A.P.Srinivas, learned Senior standing counsel appearing for the respondents and with their consent, the Writ Petitions are taken up for final disposal. 2. The petitioner in W.P.No.12794 of 2015 is a proprietary concern managed by its Proprietor Mr.C.Manoharan, who is petitioner in W.P.No.12795 of 2015 in his .....

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12795 of 2015) and she is the Managing Director of M/s.Nitish Tools Private Limited. M/s.Rukmani Explosives, who is also one of the noticees, is not a party in these Writ Petitions. The notice alleged under valuation of carbide tips and hollow drill rods imported by Nitish Tools Private Limited and the petitioner in W.P.No.12794 of 2015, Shree Sai Enterprises. After setting out the facts, it was proposed to reject the value of the carbide tips and hollow drill rods as mentioned in the bills of e .....

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y proceedings, dated 02.04.2014, a notice was issued to the petitioner calling upon him to explain and to state whether the applications contained full and true disclosure of the manner in which additional duty liability has been derived as required under Section 127B of the Act and also fulfils all the criteria under Section 127B of the Act and in particular whether any case is pending in the Appellate Tribunal or any Court. The petitioner through their counsel sent a reply on 07.04.2014, where .....

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ons of Section 127C of Act. After about four months i.e., even before the matter could be proceeded with, a communication was sent to the counsel for the petitioner from the Commission, dated 28.08.2014, stating that the Commissioner of Customs by letter dated 24.07.2014, has brought to the notice of the Commission that CBI has registered a case against the petitioner and others and the matter has been taken cognizance by the Competent Court. Therefore, the Bench called upon the petitioner to of .....

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ce, the applications filed by the petitioners and others are not hit in terms of the second proviso to Section 127B(1) of the Act. Thereafter, the Commission sent a notice dated 23.10.2014 fixing the date of hearing as 13.11.2014. Three days prior to the date of hearing, the petitioner through their counsel sought for adjournment on the ground that the petitioner C.Manoharan, is taking treatment for Spondylitis and requested the Commission to adjourn the matter. The next hearing date was fixed a .....

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ons. 3. The learned counsel appearing for the petitioner submitted that the Commission without affording opportunity to the petitioner and without taking into consideration the facts and circumstances, erroneously passed the impugned order and prayed that the order be set aside and the matter may be remanded back to the Commission. It was the endeavour of the learned counsel appearing for the petitioner to convince this Court that the said application for settlement having been allowed to be pro .....

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submitted that the observations made by the Settlement Commission are not tenable and the petitioner had no opportunity to rebut the report submitted by the Commissioner, since they had no notice of such a report and were aware of it, only when they perused the impugned order and found that in paragraph 6.5, the report submitted by the Revenue has been taken note of by the Commission. On the above grounds, the learned counsel submits that the matter may be remanded to the Commission for fresh c .....

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ons before the Commission, were filed and all arising out of the same show cause notice, dated 13.04.2013. In the said case also, the Commission passed similar order and sent back the matter to the Commissioner of Customs for adjudication by passing the order dated 29.12.2014 and the only difference being the change of cause title and the application numbers and consignment details and therefore, these Writ Petitions are also liable to be dismissed. It is further submitted that in the criminal c .....

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respect of a case, relating to him make 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 .....

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ich he had failed to disclose before the proper officer, he is required to explain to the Settlement Commission, the manner in which such liability has been incurred; the additional amount of customs duty accepted to be payable by him as also the price of such dutiable goods in respect of which he admits short levy on account of mis-calculation or otherwise. Section 127C of the Act prescribes the procedure to be followed by the Settlement Commission on receipt of the application under Section 12 .....

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on the Commission which are vested in an officer of the Customs under the Act and in terms of Section 127H, the Commission can grant immunity from penalty and prosecution with or without condition, when it is satisfied that the applicant has made a full and true disclosure of his duty liability. In terms of Section 127I, the Settlement Commission can send back the matter to the proper officer, where it finds that the applicant is not co-operating with it. Thus, the scheme of the act gives wide d .....

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ct of the applicant that he is not cooperating in the disposal, the High Court while exercising jurisdiction under Article 226 should be slow in upsetting or interfering with such finding. 7. The window given under the Customs Act by inserting chapter XIVA by Finance Act 1998, is to give a reprieve to an applicant who comes forward before the Commission by making full and true disclosure and this Commission was set up on similar lines, as that of the Commissions already functioning under the Inc .....

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s queries one among them was whether any case is pending in the Appellate Tribunal or any Court. The reply which is expected to be given by an applicant is a simple Yes or No . In the event, if the reply is Yes , he has to disclose about the case, which is pending. However, the reply given by the petitioner is not a straight forward reply, but by stating that pertaining to the show cause notice, which is subject matter of settlement application, no appeal has been filed, is pending before the Ap .....

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on the maintainability of the application. The petitioner admitted that CBI had issued summons, but stated that no case is pending in any other Court. The Commission did not pass any orders either specifically accepting the petitioner's plea or otherwise, but fixed the date of hearing on 13.11.2014. Therefore, if the petitioner was really interested in prosecuting the matter, he ought to have appeared before the Commission on the date so fixed. However, one day before the hearing, a letter .....

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