Settlement Commission allows instalment payment but revenue objects, case sent for disposal

The applicant admitted duty liability before the Settlement Commission for a specific period but failed to fulfill export obligations, leading to a Show Cause Notice by Customs. Despite financial hardship, the Commission allowed payment in instalments. Revenue objected to proceedings citing Circular No. 55, impacting the case. The applicant's financial difficulties and non-cooperation led to the case being sent back for disposal as if no application had been made.

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Issues Involved:
1. Duty liability admission by the applicant before the Settlement Commission.
2. Import of capital goods against exemption notification and failure to fulfill export obligations.
3. Commissioner's report on the duty payable and objections to the application.
4. Applicant's request for payment by instalments and financial hardship plea.
5. Revenue's submission on Circular No. 55 affecting the case proceedings.
6. Applicant's financial difficulties, loans, and advances, and inability to comply with payment directions.
7. Non-renewal of bank guarantee and Revenue's objection to case proceedings.
8. Commission's review of the case records, applicant's submissions, and Revenue's objections.
9. Applicant's non-cooperation with the Commission's payment orders and plea for encashment of bank guarantee.
10. Lack of collateral security from the applicant.
11. Objectives of settlement proceedings and applicant's failure to cooperate leading to the case being sent back to the proper officer.

Analysis:

1. The applicant admitted a duty liability of Rs. 69,19,519 before the Settlement Commission for the period of 1-8-1993 to 16-5-1994, related to 9 Bills of Entry. The imported goods valued at Rs. 9,29,22,044.80 were seized by Customs. The applicant imported capital goods against exemption notification No. 160/92-Cus. and failed to fulfill the export obligations, leading to an investigation and issuance of a Show Cause Notice (SCN) by Customs.

2. The Commissioner's report acknowledged the correct duty payable as Rs. 69,19,519 but disagreed with other contentions of the applicant. Despite the applicant's request for payment by instalments due to financial hardship, the Commission allowed payment of 20% of the admitted liability within 30 days and the balance in four equal instalments.

3. Revenue objected to the case proceedings citing Circular No. 55, affecting the Commission's decision. The applicant faced financial difficulties, with loans and advances of Rs. 8 crores, and expressed inability to comply with payment directions due to acute financial hardship.

4. The Commission reviewed the case records, applicant's balance-sheet, and noted the applicant's non-cooperation by failing to pay the first instalment as directed. The applicant's plea for encashment of a bank guarantee with DGFT was also addressed.

5. The Commission emphasized the objective of settlement proceedings to realize blocked Government revenue and found the applicant's request for a 12-month payment period not aligned with the Commission's objectives. Due to the applicant's non-cooperation, the case was sent back to the proper officer for disposal as if no application had been made under Section 127B.

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