2003 (5) TMI 438 - Commission - Central Excise

Summary

Issues: Settlement Application under section 32E of the Central Excise Act, 1944; Duty evasion through parallel set of invoices; Admission of duty liability; Waiver of penalty and immunity against prosecution; Financial hardships faced by the company.

Settlement Application under section 32E of the Central Excise Act, 1944:
The case involved Settlement Applications filed under section 32E of the Central Excise Act, 1944 by M/s. Venus Remedies Ltd. regarding a Show Cause Notice issued by the Deputy Commissioner of Central Excise, Ambala Division. The applicants sought settlement in relation to duty evasion through parallel set of invoices, totaling Rs. 44,13,331/-. The High Court had ordered the applicants to pay a specified amount under protest and deposit a monthly sum pending final adjudication.

Duty evasion through parallel set of invoices:
The case revealed that M/s. Venus Remedies Ltd. had allegedly clandestinely cleared their final products to various parties using parallel invoices, resulting in a duty evasion of Rs. 44,13,331/-. The directors were arrested and subsequently granted bail. The applicants admitted to removing goods on parallel invoices to additional parties beyond those initially mentioned in the Show Cause Notice.

Admission of duty liability, waiver of penalty, and immunity against prosecution:
During the proceedings, the applicants admitted to the duty liability, except for a specific amount already paid. They contended that an employee, without their knowledge, prepared the parallel invoices due to personal issues with the management. The applicants requested waiver of penalty and immunity against prosecution under the Central Excise Act and other Central Acts. The Revenue, however, raised concerns regarding fraud in the case despite the applicant fulfilling the conditions of section 32E.

Financial hardships faced by the company:
The applicants requested additional time for payment of the remaining admitted duty liability, citing financial hardships faced by the company. They lacked supporting evidence such as balance sheets to substantiate their financial difficulties. Despite this, the Settlement Commission allowed the case to proceed under section 32F, directing the payment of the admitted duty liability within a specified timeframe and adjusting the deposit already made towards this amount.

Conclusion:
Ultimately, the Settlement Commission approved the application to proceed under section 32F, requiring the payment of the admitted duty liability by the applicants. The Commission emphasized compliance with the Central Excise Act provisions and instructed both the Revenue and the applicants to keep the Commission informed of the payments made.