2001 (8) TMI 424 - Commission - Customs

Summary

Issues Involved:
1. Full and true disclosure of duty liability under Section 127B(1) of the Customs Act, 1962.
2. Stage of duty liability disclosure relevant for admitting the case.
3. Identification of the "proper officer" under the Customs Act.
4. Extent of disclosure required before the Settlement Commission.
5. Specific findings on whether the into-bond Bill of Entry constitutes disclosure, whether it implies contingent liability, and implications of non-filing of the ex-bond Bill of Entry.

Issue-wise Detailed Analysis:

1. Full and True Disclosure of Duty Liability:
The main issue was whether the term "full and true disclosure of his duty liability" under Section 127B(1) of the Customs Act, 1962 includes the duty assessed under Section 17 or Section 18 in respect of a bill of entry for warehousing as a contingent liability or otherwise. The Commission concluded that the term refers to the liability to duty and not the amount of duty in rupees. It emphasized that the disclosure should include details of imports and the manner in which the liability to pay additional duty arose.

2. Stage of Duty Liability Disclosure Relevant for Admitting the Case:
The Commission examined whether the relevant stage for disclosure of duty liability is during assessment under Section 17 or Section 18, or the one made under Section 68 for warehoused goods. It was determined that the disclosure of duty liability made in a bill of entry for warehousing filed under Section 46 before a proper officer under that section is the material disclosure for comparison with the disclosure before the Settlement Commission.

3. Identification of the "Proper Officer":
The question was whether the "proper officer" is the one who assessed the bill of entry for warehousing under Section 17 or Section 18, or the one who would have assessed the Bill of Entry for home consumption under Section 68. The Commission concluded that the proper officer for the purpose of Section 127B is not confined to the officer under Section 68 but includes a proper officer under Section 17 who is authorized to deal with levy, assessment, and collection of duty.

4. Extent of Disclosure Required Before the Settlement Commission:
The Commission deliberated whether the disclosure before the Commission should be larger than the disclosure made in the Bill of Entry filed before the proper officer or at any stage prior to coming to the Commission. It was held that the application must contain a full and true disclosure of duty liability not disclosed before the proper officer and the manner in which such liability has been incurred, with the additional amount of duty accepted as payable exceeding Rs. 2 lakhs over what has been disclosed earlier.

5. Specific Findings:
(i) Whether the disclosure made in the into-bond Bill of Entry should be taken as the disclosure of liability before the proper officer?
The Commission held that the disclosure of duty liability made in the into-bond Bill of Entry filed under Section 46 is the material disclosure for comparison with the disclosure before the Settlement Commission.

(ii) Whether the duty assessed in the into-bond Bill of Entry implied only a contingent liability?
The Commission found that the question does not arise as Section 127B does not make any distinction on the nature of the liability.

(iii) In case the reply to (i) above is in the negative, whether non-filing of the ex-bond Bill of Entry could be construed to mean 'nil' disclosure and as such, the duty accepted as payable in column 12 of the application be taken as additional accepted liability for purposes of clause (b) of proviso to sub-section (1) of Section 127B of the Customs Act, 1962, keeping in view the evidence relied upon in the Show Cause Notice issued?
The Commission concluded that the question does not arise in view of the reply to (i) above.

Conclusion:
The Commission rejected the application for settlement filed by M/s. Madras Petrochem Ltd. as it did not disclose any additional amount of duty accepted as payable compared to the disclosure made before a proper officer in the Bill of Entry filed for warehousing under Section 46. The application did not fulfill the requirements of Section 127B of the Customs Act, 1962. The matter was disposed of accordingly.