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TMI Blog2015 (8) TMI 681X X X X Extracts X X X X X X X X Extracts X X X X ..... f the Finance Act, 1998, which was suitably amended from time to time. With an intention to make it more workable and for speedy recovery of the revenue rather than from the cumbersome provision of the recovery proceedings, the object and purpose of the Settlement Commission can be culled out from Section 32E of the said Act where an assessee may make an application for settlement before adjudication upon making true and full disclosure of his duty liability which has not been disclosed before the Central Excise Officer provided the ingredients required therefore are satisfied. Proviso inserted thereto laid down the requisite ingredients for maintaining the said application, I would delve to deal with different provisions contained in Chapter V of the said Act but before I do so, it would be relevant to quote the foundational facts which are, more or less, admitted. 3. The Petitioner-Company is an assessee registered under the Central Excise Act and allotted the registration no. AACB4235DXN001. A search was conducted by the Director General of Central Excise Intelligence (DGEI) and seized various documents, papers and the statement and started the investigation of the duty ev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... whether the Settlement Commission is within its powers to impose penalty on each of the Directors in addition to the imposition of penalty upon the Company. In the event, the answer is positive as to whether there was a sufficient material before the Settlement Commission which is reflected in the impugned order justifying such imposition of penalty. 7. The provision relating to the Settlement Commission was subsequently introduced in the year 2007 after its successful workability and yielding the favourable result in generating the revenue under the Income Tax Act, in the Central Excise Act. The application can be made by an assessee who is liable to pay the duty under Section 32E of the Central Excise Act. There is no definition assigned to the word "assessee" in the definition clause, i.e., Section 2 of the said Act. The assessee appears to have been used in different provisions of the said Act assigning different meaning. It would not be incorrect to say that when a meaning is given in different provisions of the same Act, the meaning provided in a particular provision should be accepted and any importation from the meaning provided in the other provision, is not permiss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... three lakh rupees; and (d) the applicant has paid the additional amount of Excise duty accepted by him along with interest due under Section 11AB:" 8. One of the essential ingredients to maintain the application is that a show cause notice is issued by the Central Excise Officer for recovery of the duty and received by the applicant. Section 32F of the said Act does not provide unfettered, unbrinded right upon the assessee to have his application heard as the Settlement Commission can reject the said application, in the event, the Settlement Commission is not satisfied from the explanation provided by the assessee-applicant. If the application is allowed to be proceeded with, the Settlement Commission, shall call for the report from the Commissioner of Central Excise having jurisdiction after making further inquiry or investigation in the matter and shall take into account the records and the report so submitted. The immunity against the criminal proceeding as well as penalty and fine either wholly or in part may be granted upon being satisfied that the assessee has cooperated with the Settlement Commission and made full and true disclosure of duty liability. Section 32 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... certained, not only from the phraseology of the provision, but also by considering its nature, its design, and the consequences which would follow from construing it the one way or the other." Thus, the governing factor is the meaning and intent of the Legislature, which should be gathered not merely from the words used by the Legislature but from a variety of other circumstances and considerations. In other words, the use of the word "shall" or "may" is not conclusive on the question whether the particular requirement of law is mandatory or directory. But the circumstance that the Legislature has used a language of compulsive force is always of great relevance and in the absence of anything contrary in the context indicating that a permissive interpretation is permissible, the statute ought to be construed as peremptory. One of the fundamental rules of interpretation is that if the words of a statute are themselves precise and unambiguous, no more is necessary than to expound those words in their natural and ordinary sense, the words themselves in such case best declaring the intention of the legislature. Section 6(1) of the Act provides in terms, plain and precise, that a notific ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the law-maker expressed in the law itself, taken as a whole." 10. Keeping in mind, the object and the intendment behind incorporation of Chapter V of the said Act, the expression 'may' appear in Section 32K is discretionary and not mandatory. Though the object of incorporating the said Chapter is for speedy recovery of the duty but granting of immunity depends upon not only the cooperation in the settlement proceeding and making of true and full disclosure of the duty liability but also upon other attending facts including the conduct of the parties. While exercising the discretion which is no way to be exercised whimsically or arbitrarily, a onerous duty is cast upon the Settlement Commission to record the reasons which should be rational, reasonable and inconsonance with the spirit, object and the provision of the statute The Settlement Commission in the impugned order have recorded the elements of mens rea in concealing the duty liability and exercised its discretion properly in imposing the particular penalty not only on the company but also upon each of the directors. 11. It is argued by the department that Section 9AA of the Central Excise Act is explicit in t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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