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2016 (11) TMI 1348 - DELHI HIGH COURT

2016 (11) TMI 1348 - DELHI HIGH COURT - TMI - Search - Demand - Held that: - As is evident “case” means a proceeding in the Act or any other Act for the levy, assessment and collection of excise duty – (this provision has been incorporated for reference in the relevant provision of Customs Act), pending before an adjudicating authority before which the application under Section 32E is made - In respect of two sets of show cause notices potentially there even could have been six but these do not .....

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L. 40162/2016 - Dated:- 23-11-2016 - MR. S. RAVINDRA BHAT & MR. NAJMI WAZIRI JJ. Petitioner Through: Ms. Priyanka Goel, Adv. Respondent Through: Mr. Pramod Kumar Rai, Adv. Mr. Akhil Kulshrestha, Ad S. RAVINDRA BHAT, J (Oral) 1. Common question which arises in these petitions is whether the rejection of the petitioner s request to the Settlement Commission to adjudicate upon the show cause notice issued to them on 04.12.2015 as a proceeding connected with the applications made upon the issuan .....

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were phrased identically were issued on 16.01.2015 demanding duty based upon valuation of the goods seized, as well as in some instances currency seized (these are hereby described as the first notice ). Thereafter, further statements were recorded and the petitioners deposited the amounts which according to them constituted admitted duty liability of the respondent/department. A further show cause notice to each of the petitioners was issued (hereafter called the second notice ) on 04.12.2015 .....

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l since they did not pertain to one show cause notice. The petitioners position was that both the show cause notices were interconnected. They relied on the narrative in the first show cause notice as well as the linkage established through the second show cause notice. Furthermore, they relied upon the decision of a special bench of the Commission in Yousuff Kasim Sait [2003 (161) ELT 1069 (Sett. Comm.)] and decision of High Court of Gujarat in the case of Mahendra Petrochemical Ltd. Vs Union o .....

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ch Order No. 1/2003 (Cus) dated 30.05.2003, though noting that Section 127B(1) by implication calls for separate application for each case, but placing reliance on the wordings used in the application form SC ( C)-l and reached the conclusion that a consolidated application can be made in respect of more than one proceedings provided the issues in the proceedings are inter-related. We find that the subject matter of both the SCNs in respect of application no. 5247/2016, although issued to the sa .....

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hority on the date on which an application under sub-section (1) of section 32E is made. Further, we find that Special Bench Order No. 112003 issued with reference to the Customs (Settlement of Cases) Rules, 1999 have since been superseded by Customs (Settlement Commission) Rules, 2007. Form SC( C)-l has also been amended vide notification no. 54/2007-Cus.(NT) dated 28.05.2007. In addition, we also observe that as per Section 32A(7), a Special Bench can he constituted for the disposal of a parti .....

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was not before the Hori'ble High Court. Regarding the case of Mis. Mangala Ispat (Jaipur) Ltd. settled by the Principal Bench of the Settlement Commission vide Order No. F-2245-50/CE/15-SC(PB), it is true that the Principal Bench has admitted and settled the case where a single application was filed involving more than one SCNs. The Bench in its order has not discussed the reasons for entertaining such an application and nor has dwelt on this subject. Thus, we hold that the order relating t .....

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ble High Court of Madras in the matter relating to Optigrab International Vs. Union of India - 2010 (253) ELT 722 (Madras). Accordingly, we hold that composite application filed by the applicant in respect of two SCNs cannot be allowed to be proceeded with. 4. The petitioners urged that the reasoning of the Settlement Commission is flawed and untenable. They highlighted that the first show cause notice in each of the cases, which quantified the duty liability and further action in respect of the .....

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second show cause notice in that regard: 15. The Show Cause Notice in respect of goods seized at the premises Door Deco Industries has already been issued vide SCN C. No. IV(Hqrs.Prev.)Int/19/5/2014 dated 16.01.2015. 6. It is urged on the strength of the decision of the Special Bench in Yousuff Kasim Sait (supra) and the Gujarat High Court in Mahendra Petrochemical Ltd.(supra) that substance of dispute or lis before the Settlement Commission was one and the same and that the insistence that sep .....

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the Madras High Court in Optigrab International v. Government of India 2010 (253) ELT 722 (Mad.). In particular reliance was placed upon the following observation: 17. Therefore, in the present case, three show cause notices were issued which were answerable to three different Adjudicating Authorities before three different Commissionerates and as such the cases covered in the three show cause notices are only three different cases(1) before Deputy Commissioner, Chennai(Sea Port)(2) Deputy Comm .....

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uthority etc. and all the more, the said term 'case' does not any way refer to three offences of such kind within a year that may be charged, like the one under Section 219 of Criminal Procedure Code and therefore, the submission of the learned counsel for the appellant in regard to the applicability of Section 219 of Cr.P.C. is negatived by this Court. Admittedly no criminal cases were filed against the appellant by the second respondent. Only if criminal cases were filed by the second .....

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) - case means any proceeding under this Act or any other Act for the levy, assessment and collection of excise duty, pending before an adjudicating authority on the date on which an application under sub-section (1) of section 32E is made. 9. Section 32E (1) which is material for the purposes of deciding the present controversy reads as follows: 32E(1) - An assessee may, in respect of a case relating to him, make an application, before adjudication, to the Settlement Commission to have the case .....

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n, undervaluation, inapplicability of exemption notification or CENVAT credit [or otherwise] and any such application shall be disposed of in the manner hereinafter provided: Provided that no such application shall be made unless,- (a) the applicant has filed returns showing production, clearance and central excise duty paid in the prescribed manner; (b) a show cause notice for recovery of duty issued by the Central Excise Officer has been received by the applicant; (c) the additional amount of .....

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der Section 32E is made. The decision in Optigrab International (supra) is premised upon the fact that separate show cause notices, that involved adjudication by different authorities, were issued. At the same time, a close reading of the facts of that case reveal that the searches and investigations were common; firms which received the show cause notices were the same; all of which were issued on the same day. What persuaded Madras High Court was that the adjudicating authorities fall in diffe .....

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