2006 (2) TMI 587 - Commission - Central Excise

Summary

Issues:
1. Jurisdiction of the Settlement Commission to admit the application.
2. Validity of the Notice issued for recovery of duty.
3. Compliance with the conditions for admission of the application.
4. Settlement terms and conditions.

Jurisdiction of the Settlement Commission to admit the application:
The applicant, a company, filed an application before the Settlement Commission for settling proceedings initiated against them under a Show Cause Notice for an alleged duty payable. The applicant admitted the full duty demanded in the Notice, citing irregularities by their Chief Executive Officer. The Revenue contended that the application did not fall under Section 32E of the Central Excise Act, as no additional amount had been accepted, and recovery proceedings had been initiated. However, the Commission found that the Notice for recovery of duty met the conditions under Section 32E, as it was issued by the Central Excise Officer, and the applicant admitted the entire duty demanded. Therefore, the Commission held that the application met the conditions for admission and deserved consideration.

Validity of the Notice issued for recovery of duty:
The Revenue argued that the application did not qualify under the first proviso to Section 32E(1) of the Central Excise Act as no additional amount had been accepted, and recovery proceedings had commenced. They also claimed that the application did not fit the definition of a 'case' under Section 31(c) of the Act. However, the Commission observed that the Notice issued for recovery of duty was valid, and the applicant's admission of the full duty demanded fulfilled the conditions for admission. The Commission disagreed with the Revenue's objections and deemed the application admissible.

Compliance with the conditions for admission of the application:
During the hearing, the applicant's representatives reiterated their submission that they had paid the amount demanded and had settled a previous notice as well. The Revenue reiterated their contentions against the application. The Commission noted that the applicant had admitted the entire duty liability and had paid the same, making the matter suitable for final settlement without further hearing. The Commission decided that the applicant met all conditions for admission, including additional duty disclosure, and granted immunity from interest, fine, penalty, and prosecution.

Settlement terms and conditions:
The Commission settled the duty liability at Rs. 17,87,271, with no further duty payable since it was reported to have been paid. Immunity from interest exceeding 10% per annum was granted, with the Revenue instructed to calculate and convey the interest amount for a specified period. The applicant was required to pay the interest within a stipulated timeframe. The settlement was made in accordance with the Central Excise Act, with provisions for voiding the settlement in case of fraud or misrepresentation. The Commission provided detailed terms and conditions for the settlement, ensuring compliance and finality in the matter.