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Issues Involved:
1. True and full disclosure of facts by Respondent No. 1. 2. Oral hearing before allowing the application. 3. Recording of reasons by the Compounding Authority. Summary: 1. True and Full Disclosure of Facts: The Union of India filed a writ petition u/s 226 and 227 of the Constitution to set aside an order by the Chief Commissioner of Customs allowing compounding of an offence. The Petitioner contended that Respondent No. 1 did not make a true and full disclosure of facts as required u/s 127-B of the Customs Act and Rule 6 of the Customs (Compounding of Offence) Rules, 2005. The Court found no merit in this contention, noting that Respondent No. 1 had admitted to committing an offence u/s 111 and 77 of the Act, punishable u/s 132 and 135(1)(a) of the Act. The Court emphasized that discrepancies in the versions provided by the applicant and the investigating agency do not necessarily indicate a failure to disclose all material facts. The Compounding Authority had the discretion to accept the application if it believed a full and true disclosure was made. 2. Oral Hearing: The Petitioner argued that no oral hearing was given before the application was allowed. The Court held that the Rules do not mandate an oral hearing for either party when an application for compounding is allowed. The proviso to Rule 4(3) only requires a hearing if the application is intended to be rejected. The Court noted that the issues in this case were not complex enough to necessitate a personal hearing and that the Petitioner was given an opportunity to submit a report, which sufficed to meet the requirements of natural justice. 3. Recording of Reasons: The Petitioner also contended that the Compounding Authority did not record any reasons for granting immunity from prosecution. The Court found this contention without merit, stating that the Compounding Authority had examined all aspects of the case, including the market value of the goods, the nature of the offence, and the basis for the compounding fee. The order showed an application of mind and provided reasons sufficient for judicial review. Conclusion: The Court dismissed the petition, emphasizing that the scope of judicial review in such cases is limited. It highlighted that discrepancies in the applicant's and investigating agency's versions do not necessarily mean a failure to disclose all material facts. The Court also noted the recent introduction of 'plea bargaining' in the Code of Criminal Procedure, 1973, and suggested that settlement procedures should be liberally construed to avoid protracted proceedings.
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