Full and true disclosure under settlement law cannot be denied merely because limitation and refund objections are raised.

A settlement application under Section 32E of the Central Excise Act, 1944 was maintainable after issuance of a show cause notice, and the disclosure requirement was satisfied where the applicant identified the duty already paid and the liability admitted for the period covered by the notice. The Settlement Commission could not reject the application on a technical view merely because the applicant also raised limitation and refund contentions, since those points did not by themselves negate full and true disclosure. The rejection for want of full and true disclosure was therefore not justified.

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Issues: Whether the Settlement Commission was justified in rejecting the settlement application on the ground that there was no full and true disclosure of duty liability.

Analysis: The application under Section 32E of the Central Excise Act, 1944 was maintainable after issuance of a show cause notice, which is a condition precedent for approaching the Settlement Commission. The disclosure made by the petitioner, though not artfully presented, referred to the duty already paid and the liability admitted for the period covered by the notice. The fact that the petitioner also contended that part of the demand was time-barred and sought refund did not, by itself, establish absence of full and true disclosure. The rejection was therefore based on an unduly technical approach to the statutory requirement.

Conclusion: The rejection of the settlement application for want of full and true disclosure was not justified, and the petitioner succeeded on this issue.

Ratio Decidendi: A settlement application cannot be rejected for lack of full and true disclosure merely because the applicant raises a limitation objection or seeks refund, if the material duty liability and payments made are otherwise disclosed with sufficient clarity.

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