VISHNU STEELS Vs. UNION OF INDIA

JUDGEMENT

(1.) Rule; with the consent of Counsel for the parties returnable forthwith. With the consent of Counsel and at their request the Petition is taken up for hearing and final disposal.

(2.) The Petitioner challenges an order passed by the Settlement Commission by which an application under Section 32E of the Central Excise Act, 1944 for settlement of the dispute arising out of a notice to show cause dated 24 June 2010 issued by the Additional Director General, DGCEI, Mumbai demanding differential duty of Rs.1.73 crores and CENVAT credit of Rs.8.77 lakhs has been dismissed on the ground that it is not maintainable. The order of the Settlement Commission is on a split verdict. Two members of the Settlement Commission have held that since the application for settlement was filed on 14 January 2011, a day after the order of adjudication dated 13 January 2011, it was not maintainable under Section 32E. The third member of the Settlement Commission has however held, following the judgment of a Division Bench of the Delhi High Court in Qualimax Electronics Private Limited vs. Union of India, 2010 257 ELT 42 that an order of adjudication is made on the date on which the adjudicating authority dispatched it to the assessee and since the date of dispatch was after the filing of the settlement application, the application was maintainable.

(3.) The Petitioner is engaged in the manufacture of excisable goods falling under Chapter 72 of the Central Excise Tariff. On 24 June 2010, a notice to show cause was issued to the Petitioner by the Additional Director General, DGCEI, Mumbai, demanding differential duty of Rs.1.73 crores under Section 11A(1) of the Central Excise Act, 1944 and CENVAT credit amounting to Rs.8.77 lakhs together with interest. During the course of the adjudication proceedings, the Petitioner sought copies of documents, which were relied upon in the notice to show cause, by a letter dated 9 September 2010, and sought an extension of time to respond to the notice to show cause. This request was reiterated in a letter dated 28 October 2010. On 29 October 2010, a letter of the Superintendent (Adjudication) was dispatched to the Additional Director General, DGCEI, Mumbai, calling upon him to arrange for supply of copies of documents which were relied upon in the notice to show cause. On 10 December 2010, the Petitioner reiterated the request for the supply of the documents. In the meantime, the hearing on the show cause notice was adjourned on several dates before the adjudicating authority. On 15 December 2010, the Petitioner reiterated its earlier request for disclosure of documents and informed the adjudicating officer that it was exploring the possibility of filing a settlement application. Since the Petitioner was yet to obtain copies of the documents, it requested that the adjudication may be held in abeyance for a period of three or four weeks. On 10 January 2011, the Petitioner's Advocate addressed a letter to the Commissioner specifically stating that a decision had been taken to file a settlement application under Section 32E of the Central Excise Act, 1944. Together with the letter, which was received by the Commissioner on the same day, the Petitioner enclosed a copy of the GAR-7 challan reflecting the payment of the fee for filing of the settlement application.