Settlement proceedings require full disclosure and cooperation; refusal upheld where the applicant continued disputing core facts.

Settlement relief was properly refused because the applicant did not make full disclosure or show the cooperation required for settlement. The challenge based on non-supply of the last clarificatory report failed, as the real issue was the applicant's overall conduct and its continued contest on core facts rather than any minor numerical discrepancy. The Court accepted that settlement proceedings demand a spirit of surrender, not an adjudicatory contest, and upheld the Commission's view that there was no convergence on fundamental facts. The alleged breach of natural justice was not established, and the refusal to grant relief remained valid.

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Issues: Whether the Settlement Commission's refusal to grant relief was vitiated by breach of natural justice, and whether the applicant had made the true disclosure and cooperation required for settlement.

Analysis: The challenge based on non-supply of the last clarificatory report was rejected because the real dispute was not a minor numerical discrepancy in DG sets but the applicant's overall conduct and disclosure before the Settlement Commission. The applicant had not accepted a substantial part of the duty liability and had approached the forum while contesting the Revenue's case on core facts. The Commission's view that there was no convergence on fundamental facts was upheld, and the Court accepted that settlement proceedings require full disclosure and a spirit of surrender, not an adjudicatory contest. The Court also held that the term cooperation in the settlement context is fact-sensitive and that the applicant's conduct did not amount to cooperation.

Conclusion: The refusal to grant settlement relief was valid, no breach of natural justice was shown, and the writ petition failed.

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