2006 (7) TMI 31 - Commission - Central Excise

Central Excise Applicants using dilatory tactics to delay disposal of settlement application filed by them in order to agitate same before judicial forum as well as approaching to Hon ble Courts Search bring-out much larger evasion of duties Appeal not satisfy statutory conditions

Summary

Issues Involved:
1. Admission of applications under Section 32E of the Central Excise Act, 1944, and Section 127B of the Customs Act, 1962.
2. True and full disclosure of duty liability.
3. Adjournment requests and their validity.
4. Ongoing investigations and their impact on the settlement process.
5. Compliance with statutory conditions for admission of applications.

Detailed Analysis:

1. Admission of Applications:
The applications filed by the applicant and co-applicant under Section 32E of the Central Excise Act, 1944, and Section 127B of the Customs Act, 1962, were considered for admission. The applicants sought settlement for pending duty liabilities and immunities from prosecution under various Acts.

2. True and Full Disclosure of Duty Liability:
The applicant admitted a duty liability of Rs. 41,92,651/- in a sealed cover. However, the Revenue contended that the applicant had not made a true and full disclosure. The total duty liability as per the Revenue's investigation was significantly higher, amounting to Rs. 1,46,62,178/- for Central Excise and Rs. 4.51 crores for Customs. The applicant's admission was limited to Central Excise duties and did not cover Customs duties, which was a major point of contention.

3. Adjournment Requests:
The applicants sought adjournment on multiple grounds, including the detention of the co-applicant under the COFEPOSA Act and the unavailability of their counsel. The Revenue opposed these requests, arguing that the applicants were using dilatory tactics to delay the proceedings. The Settlement Commission noted that while the applicants expressed urgency in other judicial forums, they sought to delay the settlement proceedings. Despite these observations, the Commission granted the first adjournment request but rejected subsequent ones due to lack of sound grounds and inconsistency in the applicants' actions.

4. Ongoing Investigations:
The Revenue highlighted that investigations were ongoing and had not yet quantified the full duty liability. The DRI was conducting detailed investigations into fraudulent exports and duty evasion involving several crores. The Commission noted that the investigations were complex and involved multiple jurisdictions, making the applications premature. The applicant's actions were seen as attempts to stall these investigations.

5. Compliance with Statutory Conditions:
The Commission emphasized that the applications did not satisfy the statutory conditions for admission. The applicants failed to make a true and full disclosure of duty liability, as required under Section 127B of the Customs Act, 1962, and Section 32E of the Central Excise Act, 1944. Additionally, the necessary Show Cause Notices (SCNs) quantifying the full duty liability had not been issued, and the 180-day period from the date of seizure had not elapsed.

Conclusion:
The Settlement Commission rejected the applications for failing to meet the statutory conditions for admission. The applicants were advised that they could file fresh applications upon receiving SCNs indicating the amount of additional duty disclosure. The Commission's decision was based on the applicants' lack of true and full disclosure, ongoing investigations, and the premature nature of the applications. All concerned parties were informed accordingly.