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TMI Blog2016 (4) TMI 932X X X X Extracts X X X X X X X X Extracts X X X X ..... “before adjudication” , instead of filing a reply to the notice and having the case adjudicated, filed applications before the Commission for settlement. So the respondents opted for settlement before the Commission, - a statutory forum created for the said purpose. Thus having opted for settlement and having accepted the amount of excise duty payable by them, the respondents cannot now turn back and challenge the penalty imposed by filing a writ petition because it would mean arguing the case on merit which under Section 33 of the Act can only be dealt with and decided by an adjudicating authority. Had there been adjudication and had duty liability been established, under section 11AC the respondents might have faced prosecution from which the Commission had granted immunity. Whether the order directing imposition of penalty is severable or not - Held that:- since section 32K speaks of “immunity from prosecution for any offence under this Act and also either wholly or in part from the imposition of any penalty and fine” (emphasis supplied), the order of penalty cannot be severed from the order of prosecution. It is a composite order. The words “and also” make the order of pros ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rs) whereby the learned Single Judge, while coming to a finding that this Court had jurisdiction to entertain the writ petition, had allowed the writ petition by holding, inter alia, as under:- For the reason discussed above, the writ petition is allowed. The impugned final order No.F-282/CE/11-SC (KB) dated 23rd September, 2011, passed by the Customs and Excise Settlement Commissioner, Additional Bench, Kolkata, is set aside to the extent it purports to levy penalty on the petitioners. The concerned respondents shall forthwith, and in any case within two months from the date of receipt of a certified copy of this order, refund the penalty amount paid by and/or realized from the respective writ petitioners. (page 781 of the stay application). In this appeal the appellant has challenged the said judgment on principally on two grounds, - that this High Court had no jurisdiction to entertain the writ petition and the writ petition was without merit. Mr. R. Bharadwaj learned advocate for the appellant submitted that as the office of the writ petitioner is situated in Orissa and as a major part of the cause of action arose outside the jurisdiction of the Calcutta High Cour ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... use notice, the learned Judge erred in holding that the allegations of fraud, suppression and misstatement are bald, totally vague and devoid of any particulars. In short, submission was that as it is evident from the notice that the respondents failed to file return and did not pay duty in time and as instead of replying to the said notice the respondents had opted for settlement making a true and full disclosure, and as order was passed after giving hearing and as the respondents had admitted that an order by the Commission is a package and as having been granted immunity from prosecution respondents cannot challenge the order passed by Commission, the learned Single Judge had erred in passing the judgment. Mr. Bharadawaj had referred to the following judgments in support of his submission which are as under:- (1) Sun Pharmaceutical Industries Limited v. The Union of India Others: 2007-(218)-ELT-0495-BOM, (2) Brindavan Beverages Pvt. Ltd. v. Commissioner of C. Ex., Meerut: 2009-(237)-ELT-0658-DEL and (3) the unreported judgment delivered on 6th July, 2015 in MAT 1856 of 2014 (Venky Hi-Tech Ispat Ltd. v. Customs and Central Excise Settlement Commission). Mr. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2 SCC 777; 6) Uttamrao Shivdas Jankar v. Ranjitsinh Vijaysinh Mohite Patil: (2009) 13 SCC 131; 7) Union of India v. Rajasthan SPG. WVG. Mills:(2009) 13 SCC 448; 8) Kusum Ingots Alloys Ltd. v. Union of India: 2004(168) ELT 3 (SC); 9) Asahi India Safety Glass Ltd. v. Union of India: 2005 (180) ELT 5 (Del.); 10) Commissioner of C. Ex., Pune v. Coca-Cola India Pvt. Ltd.: 2007 (213) ELT 490 (SC); 11) Viva Herba Pvt. Ltd. v. Union of India: 2010(260) ELT 168 (Bom.); 12) Swasthik Tobacco Factory v. Cus. C. Ex. Settlement Commission: 2012 (281) ELT 674 (Mad.) and 13) Nirlon Ltd. v. Commissioner of Central Excise, Mumbai: 2015 (320) ELT 22 (SC). The issues to be considered are i) Whether the writ petition is maintainable, ii) Whether the order of penalty passed by the Commission is severable and iii) Whether in the facts of the case the learned Single Judge was justified in directing refund of penalty imposed. So far as the first issue is concerned, there is no dispute that the Commissioner Central Excise, Customs and Services Tax, Bhubaneswar had issued the demand-cum-show cause notice. There is also no dispute that respondents ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... led at 66,64,19,436. This amount has already been deposited by the applicant, the same is ordered to be appropriated by the Commissioner within 30 days from the date of receipt of this order. Interest: The applicant has paid interest amount of 15,37,19,183. There being no dispute from the department regarding quantum of interest payable over and above the aforesaid amount, the same is ordered to be appropriated by the Commissioner within 30 days from the date of receipt of this order. Penalty - Taking into account the facts and circumstances of the case, the Bench grants immunity to the applicant (M/s. Vedanta Aluminium Limited) from penalty as is in excess of 4,00,00,00 (Rupees four crore only) and to the coapplicants Shri Rajesh Mohata from penalty as is in excess of 5,00,000 (Rupees five lakh only), Shri TPK Patro from penalty as is in excess of 5,00,000 (Rupees five lakh only), Shri P.S Reddy from penalty as is in excess 5,00,000 (Rupees five lakh only), and Shri Purushottam Kumar Choudhury) from penalty as is in excess of V5,00,000 (rupees five lakh only) under the provisions invoked in the SCN. The amounts of penalty should be paid within 15 days from ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by the Commission is an agreement in a statutory form, the respondents, having been granted immunity from prosecution, cannot challenge the imposition of penalty only. Under the statute the order of penalty is not segregable. As the order of penalty and prosecution cannot be segregated, either the applicant accepts the order in its entirety or the settlement fails. Admittedly a package, an order passed by the Commission, should be read as a whole. It is to be noted that the learned Judge even while holding penalty being segregable and unsustainable held It is true that ordinarily the settlement comes as a package and composite tax statement is either to be accepted or rejected. The settlement tax cannot be accepted only in part. (page 780 of the stay application). In view of the discussion as aforesaid, in a case where the applicant is dissatisfied with the order, either prayer can be for adjudication by the Central Excise Officer or for remand before the Commission, a suggestion, which put during hearing, did not find favour with the respondents. This apart there is another aspect of the matter. We find that after order was passed by the Settlement Commission, as evident fr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... So far as the judgments relied on behalf of the respondent are concerned, the judgments in Amco Batteries (supra), in Commissioner of C. Ex., Pune v. Coca-Cola India Pvt Ltd (supra), in Union of India v. Rajasthan Spinning and Weaving Mills (supra) and in Nirlon Limited (supra) are not applicable as those judgments were passed after culmination of regular proceedings where arguments were made on merit and not in proceedings arising out of an order passed by the Settlement Commission. As the suggestion made by the Court for remanding the matter after setting aside the entire order was unacceptable to the respondents and as an order of settlement is admittedly a package, the judgments in Asahi India (supra), in Viva Herba (supra) and in Swasthik Tobaco (supra) are inapplicable. As the respondents in their applications had admitted the allegations in the demand-cum-show cause notice, as there is no dispute that the Commission during the proceedings had followed the provisions contained in Chapter V of the Act, as the respondents were given hearing and the order under challenge contains reasons, the judgments in Jyotendrasinhji (supra), in Municipal Council, Ratlam (supra), in Stat ..... X X X X Extracts X X X X X X X X Extracts X X X X
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