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2010 (6) TMI 195 - HC - Central ExciseMaintainability- Adjudicating order dated 24.12.2009 but received after 8.1.2010 when application for settlement filed. Issue whether on date of settlement application, case already stood adjudicated or not. Application rejected holding case already adjudicated or not. Application rejected holing case already adjudicated. Order in original dated 24.12.2009 not served on petitioners or their agents but sent by registered post subsequent to filing of settlement application on 8.1.2010. Adjudicating order signals end of case pending before adjudicating authority and it closes window of opportunity of settlement. Receipt of order in original not relevant for settlement of case. Date of adjudication to be the date when such order goes out of control of adjudicating authority by signing and sending it to assessee. Date of dispatch from office of adjudicating authority relevant. Impugned order in original left office of adjudicating authority on 31.12.2009 and adjudication became effective and complete on such date. Pre condition of case pending adjudication on date of settlement application not satisfied. Impugned order rejecting settlement application sustainable.
Issues Involved:
1. Whether the "case" of the petitioners had been "adjudicated" prior to the filing of their settlement applications under Section 32E of the Central Excise Act, 1944. 2. The significance of the date of receipt of the order-in-original by the petitioners. 3. The jurisdiction of the Settlement Commission to entertain the plea of settlement. Detailed Analysis: Issue 1: Whether the "case" of the petitioners had been "adjudicated" prior to the filing of their settlement applications under Section 32E of the Central Excise Act, 1944. The central question was whether the petitioners' case had been adjudicated before they filed their settlement applications. The order-in-original was passed on 24.12.2009 but was received by the petitioners after 08.01.2010, the date on which they filed their settlement applications. The petitioners argued that the case could not be considered adjudicated until they received the order. They cited the Settlement Commission's practice and decisions such as Emjay Creations (2007) and Government Wood Works v. State of Kerala (1988) to support their position. On the other hand, the respondents contended that the relevant date was when the order was passed, not when it was received, emphasizing a literal interpretation of Section 32E. Issue 2: The significance of the date of receipt of the order-in-original by the petitioners. The court examined precedents, including decisions of the Supreme Court and various High Courts, to determine the significance of the date of receipt. It was established that for the purposes of limitation for filing appeals or reviews, the date of communication of the order is crucial. However, in this case, where the adjudication of the case by the adjudicating authority signals the end of the case pending before it, the date of receipt of the order by the petitioners was deemed inconsequential. The court concluded that the adjudication becomes effective when the order leaves the control of the adjudicating authority, which in this case was 31.12.2009. Issue 3: The jurisdiction of the Settlement Commission to entertain the plea of settlement. The court noted that the Settlement Commission could only settle a case pending adjudication on the date the settlement application is received. Since the order-in-original had left the control of the adjudicating authority on 31.12.2009, the case was no longer pending adjudication on 08.01.2010, when the petitioners filed their applications. Hence, the Settlement Commission had no jurisdiction to entertain the settlement applications. The court emphasized that the date of despatch of the order from the adjudicating authority's office is the critical date for determining whether a case is pending adjudication. Conclusion: The court dismissed the writ petitions, holding that the Settlement Commission correctly rejected the settlement applications as the case had already been adjudicated by the time the applications were filed. The court concluded that the date of despatch of the order-in-original (31.12.2009) was the effective date of adjudication, not the date of receipt by the petitioners.
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