TMI Blog2016 (8) TMI 784X X X X Extracts X X X X X X X X Extracts X X X X ..... gard it is noteworthy that the “Explanation” to section 32-O(1)(i), inserted by Finance (No.2) Act, 2014, laying down that “concealment of particulars of duty liability relates to any such concealment made from the Central Excise Officer” is in aid to and is evidently in consonance with the provisions contained in section 32-E(1) which provides “An assessee may, in 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 prescribed and containing a full and true disclosure of his duty liability which has not been disclosed before the Central Excise Officer having jurisdiction,….” Whether in view of the order dated 27th August, 2014, rejecting the application for settlement, the settlement proceedings stood abated under section 32F(1) and if so, whether the appellants are entitled to have their case adjudicated before the appropriate authority - Held that:- it is evident that by order dated 27th August, 2014 the Commission had rejected that application for settlement for lack of jurisdiction. Hence, on 27th August, 2014, under Section 32F(1) the proceedings stood a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o the concealment from Central Excise Officer and not from the Settlement Commission. 12. The Bench has no jurisdiction to entertain such an application as it is barred by Section 32O(1)(i) of the Central Excise Act, 1944 and is liable to dismissal, without going into the merits of the case. The application of the coapplicant cannot also be settled when the main applicant is not eligible to come before the Settlement Commission. In terms of Section 32O(1)(i) of the Central Excise Act, 1944, without going into the merits of the case, both the application are outrightly rejected and dismissed. (Emphasis supplied) 3. Mr. J.P. Khaitan, learned senior advocate appearing for the appellant submitted that the Commission erred in rejecting the application for settlement holding it being barred by the provisions contained in section 32-O(1)(i) of the Central Excise Act, 1944 ( Act for short) as in earlier proceedings penalty was not imposed for concealment of particulars of liability duty. Hence, as the bar under section 32-O(1)(i) of the Act has no application, the application for settlement should not have been rejected. Earlier, in the final order of settlement dated 4th Januar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tate of Madhya Pradesh: 1983 ELT 1277 (S.C); Jyotendrasinjhi v. S.I. Tripathi: 1993 ITR (201) 611; Cosmic Dey Chemical v. Collector of Central Excise, Bombay: 1995 (75) E.L.T. 721 (S.C.); K.C. Builders v. Assistant Commissioner of Income-Tax: 265 ITR 562(SC); Amrit Foods v. Commissioner of Central Excise, U.P: 2005 (190) ELT 433 (SC); LIC v. R. Suresh : (2008) 11 SCC 319; Jai Jagdamba Malleable (P) Ltd. v. Union of India: 2009(237) ELT 240 (S.C); Union of India v. Rajasthan Spinning Weaving Mills: 2009 (238) ELT 3(SC) and Union of India v. Asahi India Safety Glass Ltd.: 2015 (32) ELT 179 (SC). 4. Mr. Pradip Kumar Ray, learned advocate for the respondent, submitted that in 2005 the appellant was found to have indulged in clandestine removal of goods. The appellant while applying for settlement stated that corrective measures had been taken and undertook such irregularities would not occur in future. Thereafter, the matter was settled at ₹ 8,05,019 being the Central Excise duty equivalent to the demanded amount and full immunity was granted from penalty and prosecution. In 2011 the appellants were found indulging in clandestine removal of goods. The appellants again filed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on.- In this clause, the concealment of particulars of duty liability relates to any such concealment made from the Central Excise Officer.] then, he shall not be entitled to apply for settlement under section 32E in relation to any other matter. 7. Sub-section 2 to section 32-O, inserted with effect from 1st June, 2007 and omitted with effect 8th May, 2010 is as under:- (2) Where an assessee has made an application under sub-section(1) of section 32E, on or after the 1st day of June, 2007 and if such application has been allowed to be proceeded with under sub-section (1) of section 32F, such assessee shall not be entitled to apply for settlement under section 32E in relation to any other matter: Provided that such assessee shall not be prevented from filing an application for settlement if the issue in the subsequent application is, but for the period of dispute and amount, identical to the issue in respect of which the earlier application is pending before the Settlement Commission. 8. So far as the first issue is concerned it is evident from facts as revealed from the show cause notice that on 22nd August, 2012 that acting on a specific information that the appella ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... had already been taken while assuring that such type of irregularity would not occur in future. The said case was settled at C.E. duty 8,05,019, being equivalent to the demanded amount, granting full immunity from fine, penalty and prosecution to both the applicants. Thus the applicants appear to be habitual in committing offence and thus they cannot deserve full immunity any further. 12 ...Taking the above into account and in the facts and circumstances of the case, the Bench settles the case under Section 32F of the Act on the following terms and conditions:- ORDER Central Excise Duty : The Central Excise Duty in this case is settled at 33,44,227. This amount is ordered to be appropriated by the Commissioner from the amount of ₹ 35 lakh lying in deposit, within 30 days from the date of receipt of this order. Interest : The amount of interest 62,876 should also be appropriated by the Commissioner from the balance of 35 lakh lying in deposit after appropriating the amount of C.E. duty mentioned above, within 30 days from the date of receipt of this order. Penalty - Taking into account of facts and circumstances of the case and repetitive nature of off ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ages might have occurred due to burning loss, wrong recording of stock entries, scrap cutting, pilferages, etc. Q.3 Mr. Chawla against the restriction imposed under the Notification 32/2006 CE-(NT) dated 30.12.2006 where in the grounds of appeal you have solemnly affirmed in the Writ preferred what you have stated in your answer to question no.2 Do you stand by this? Ans: Yes, what ever we have stated earlier today and in the Writ we on behalf of the company stand by what I have stated. Q-4 Mr. Chawla do you have any thing more to say? Ans: I have nothing more to add. (page 15 of the supplementary affidavit) (Emphasis supplied) 11. Thus it is clear from the admission of the appellant no.2 in the 2010 proceedings that there was concealment of particulars of duty liability which, by order dated 4th January, 2011 passed under section 32F(5), led to the imposition of penalty for concealment of duty liability as noted in paragraph 9.0 of the order dated 27th August, 2014. Since it is evident from the order dated 4th January, 2011 that penalty was imposed on the appellants for concealment of particulars of their duty liability which had been taken note of and discus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sion on the ground of lack of jurisdiction. Therefore, as and when the Commission took up applications for hearing no other application on the identical issue was pending before it. As it is explicit, that in the earlier proceedings penalty was imposed for concealment of particulars of duty liability, the Commission was justified in passing the order dated 27th August, 2014 which was rightly upheld by the learned Single Judge. Apart from the discussion, as noted hereinbefore, there is an important aspect which cannot be lost sight of. It appears from the order dated 4th January, 2011 that in 2005 proceedings were initiated against the appellants for clandestine removal of goods. The appellants admitted about such clandestine removal and informed the Bench that corrective measures had already been taken while assuring that such type of irregularity would not occur in future. On such assurance, though duty was settled at ₹ 8,05,019, immunity was granted to the appellants from fine, penalty and prosecution. Thereafter, as the appellants were again found to be indulging in clandestine despatch of finished goods without payment of duty, show cause notice was issued. The app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y application) and as the Explanation to section 32-O(1)(i) introduced clarifies the law, the judgments in Hoosein Kasam Dada (supra) and in the Life Insurance Corporation v. R. Suresh (supra) are not relevant. As the appellants after having undertaken not to indulge in irregularities, had subsequently had gone back and indulged in concealing particulars of duty liability and as it is evident from the proceedings which culminated in passing the order dated 4th January, 2011 imposing penalty for evasion of duty, as the appellant had admitted clearances of goods without payment of duty and did not disown the responsibility, the principles of law laid down in Cosmic Dye Chemical (supra) and In K.C. Builders (supra) are not applicable. 12. So far as the second and third issues are concerned it is evident that by order dated 27th August, 2014 the Commission had rejected that application for settlement for lack of jurisdiction. Hence, on 27th August, 2014, under Section 32F(1) the proceedings stood abated. Since the appellants cannot be without a remedy, the show cause notice dated 6th February, 2014 has to be adjudicated under the Act. 13. Hence, the appeal is dismissed. The jud ..... X X X X Extracts X X X X X X X X Extracts X X X X
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