Settlement Commission affirms jurisdiction in DEPB/DEEC/EPCG cases despite Revenue objections

The Settlement Commission allowed the applicant's case to proceed, affirming jurisdiction in DEPB/DEEC/EPCG cases despite Revenue objections. The applicant admitted duty liability under the Customs Act, with discrepancies in duty calculation. The Commission referenced past decisions supporting its jurisdiction, recommending a review of Circular No. 53/2002-Cus for clarity. Instructions were advised to be issued by the Central Board of Excise and Customs. The applicant was directed to deposit admitted duty liability within 30 days, emphasizing fulfillment of admission conditions under Section 127B of the Act.

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Issues:
Jurisdiction of Settlement Commission in DEPB/DEEC/EPCG cases.

Analysis:
The case involved the settlement of a dispute regarding Customs duty liability arising from an EPCG Licence issued to the applicant. The applicant admitted a duty liability of Rs. 2,16,610 under Section 127B of the Customs Act, 1962. The applicant argued that the Customs duty demanded by DGFT was calculated incorrectly, and the duty amount should be Rs. 5,25,313 instead of Rs. 6,03,400. The applicant had fulfilled partial export obligations, and the duty liability was calculated on a pro rata basis. The Revenue objected to the admission of the case, citing a circular stating that the Settlement Commission lacked jurisdiction in such matters. However, the Bench found that the Settlement Commission had jurisdiction in similar cases as per previous decisions, including Re: Bell Granito Ceramica Ltd. and Mahendra Petrochemicals Ltd. The application was allowed to proceed under Section 127C(1) of the Act, with the applicant directed to deposit the admitted duty liability within 30 days.

The Revenue raised objections regarding the jurisdiction of the Commission in DEPB/DEEC/EPCG cases, citing Circular No. 53/2002-Cus. The Bench highlighted previous cases where the jurisdiction of the Settlement Commission was not questioned in similar matters. The Circular dated 20-8-2002 needed to be reviewed, and suitable instructions were recommended to be issued by the Central Board of Excise and Customs. The Secretariat was directed to forward a copy of the order to the Chairman, CBEC, and all concerned parties were informed accordingly. The Commission emphasized the settled jurisdiction of the Commission in DEEC/DEPB/EPCG cases and the need for clarity on the Circular's applicability in such matters.

In conclusion, the Settlement Commission allowed the application to proceed, emphasizing the applicant's fulfillment of conditions for admission under Section 127B of the Act. The jurisdiction of the Commission in DEPB/DEEC/EPCG cases was affirmed based on previous decisions, despite objections raised by the Revenue. The Circular regarding the Commission's jurisdiction needed a review, and suitable instructions were recommended to be issued by the Central Board of Excise and Customs for clarity in such cases.

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