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TMI Blog2019 (7) TMI 622X X X X Extracts X X X X X X X X Extracts X X X X ..... le value of Rs. 13,93,827/- (based on Invoice C&F value of US $ 29463). The Customs Authorities, upon checking, found that the said goods were undervalued and, accordingly, served a Show Cause Notice on 07.02.2007 on the Assessee, demanding additional Customs Duty of Rs. 18.00 lakhs along with confiscation of the goods and imposition of penalty under Section 112 of the Customs Act,1962. The Assessee contended before the authorities that the goods in question were second hand and the same were supplied 'free of cost' by their related party in South Korea and only the packing and logistics costs were borne by the importer-assessee, which were reflected in the Invoice produced. 4. The Assessee, at the state of Show Cause Notice itself, straightaway approached the Settlement Commission, constituted under Chapter XIV-A of the Customs Act, 1962, for settlement of the dispute and agreed before the said Settlement Commission that it would be willing to pay additional Customs Duty, subject to the grant of immunity from penalty and prosecution in terms of the provisions under Section 127-A to 127-J of the Customs Act,1962, contained in Chapter XIV-A of the said Act. 5. Accordingl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n respect of Customs Duty paid under the Customs Act,1962, was not prohibited by the provisions of the Customs Act,1962, and merely because the Appellant-Assessee approached the Settlement Commission, constituted under the provisions of the Customs Act,1962, it neither amounted to admission of any guilt, fraud or misstatement on the part of the Assessee nor the customs duty paid by the Assessee under the orders of the Settlement Commission could be held to be disentitled to the Cenvat Credit in terms of Cenvat Credit Rules,2004, under the Excise Law. 9. The learned counsel drew our attention particularly to Rule 3 Sub-clause (7), which stipulates that a manufacturer or purchaser of a final product shall be entitled to take credit of the additional duty leviable under Section 3 of the Customs Tariff Act equivalent to the duty of excise specified under the clause specified therein, which is, in short, called 'CVD'. Further, referring to Rule 9 of the same Rules, the learned counsel submitted that Rule 9 of the Cenvat Credit Rules,2004, permits documents and accounts to be produced by the manufacturer to claim Cenvat Credit and, therefore, the production of a Supplementary I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... It was only upon adjudication and verification by the authorities of the Department, the imposition of customs duty on the import of the said machinery was accepted by the Assessee without any contest, by approaching the Settlement Commission under the provision of Section 127 of Chapter XIV-A of the Customs Act,1962. He further submitted that merely because the Assessing Authority, in pursuance of the Show Cause Notice, was not allowed to give any findings with regard to fraud, collusion, misrepresentation or suppression of facts, it does not entitle the Assessee to claim Cenvat Credit under Rule 9 (1) (b) of the Cenvat Credit Rules,2004, later on, of the Duty so paid under the orders of the Settlement Commission. He also submitted that the order of the Settlement Commission at the stage of Show Cause Notice resulted in a Final Order in favour of the Assessee, giving him immunity from penalty and prosecution, subject to the condition of payment of additional Customs Duty determined, which was found to be payable, setting aside the undervaluation or depressed valuation of the imported items shown in the Invoice and, therefore, such Customs Duty paid by the Assessee cannot be said ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as the Settlement Commission was approached at the initial stage of Show Cause Notice itself and also got immunities from penalty and prosecution and all thus would be defeated, will undo what was achieved for settling the dispute between both the parties, by invoking Chapter XIV of the Customs Act,1962, for settlement of the dispute. 16. The provision of Chapter XIV-A of the Customs Act,1962, providing for settlement of disputes by the Settlement Commission is an independent Code and while it is provided to enact a remedial forum for putting an end to disputes in a quicker and more peaceful manner, it gives several advantages to the Assessees and the disputing parties mainly in the form of immunity from penalty and prosecution, which rigor of law would have been otherwise applicable to the Assessee besides the determination of disputed amount of duty under the provisions of the Act. The impermissibility of reopening of the order passed by the Settlement Commission in any proceeding under the Customs Act itself or under any other law does not only mean Assessment or other legal proceedings, but the said provision is intended to put an end to any possibility of later on tinkering ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nts of the Show Cause Notice in the present case, would clearly reveal that the case of the Revenue against the Assessee in the said Show Cause Notice was that of misstatement of facts and suppression of facts as well as misrepresentation of the assessable value of the goods to the extent of Rs. 49,02,861/-, which was declared only at Rs. 13,93,827/-. Merely because the said Show Cause Notice did not result in any Final Order at the instance of the Assessee itself, it does not mean that there was no case of fraud or misrepresentation or wrong declaration on the part of the Assessee. Therefore, even on the applicability of Rule 9 (1) (b) of the Cenvat Credit Rules,2004, we find that the denial of Cenvat Credit to the Assessee in the present case independently was also justified. 21. Viewed from any angle, we do not find any merit in the contention raised by the learned counsel for the Assessee that the Assessee was independently entitled to Cenvat Credit in respect of the CVD paid by it under the orders of the Customs Duty Settlement Commission in the present case under the provisions of Cenvat Credit Rules,2004. Thus, the present Appeal of the Assessee is liable to be dismissed. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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