Adjudication by communication and ineligibility under settlement scheme where no proceeding was pending on the relevant date.

A communication issued after hearing the assessee and determining the balance duty payable was treated as an adjudication and demand order under central excise law, even though it was not in the prescribed format. The court held that substance prevailed over form because the officer had considered the representation and fixed the liability. It also held that the Kar Vivad Samadhan Scheme, 1998 could not be invoked where no appeal, reference, writ petition, or revision was pending on the relevant date. As the demand had already been adjudicated and no proceeding was pending, the statutory conditions for the Scheme were not met, and rejection of the declaration was sustained.

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Issues: (i) Whether the communication dated 14 July 1995 amounted to an adjudication order determining the duty payable under the Central Excise law; (ii) Whether the appellants were entitled to invoke the Kar Vivad Samadhan Scheme, 1998.

Issue (i): Whether the communication dated 14 July 1995 amounted to an adjudication order determining the duty payable under the Central Excise law.

Analysis: Under Section 11A(2) of the Central Excise Act, once the officer considers the representation, if any, and determines the amount of duty due, the assessee becomes liable to pay the amount so determined. The communication recorded that a personal hearing had been given, referred to the amounts already paid, and called upon the appellants to pay the balance demand. The fact that the communication may not have been in the prescribed format did not detract from its substance as a determination of duty.

Conclusion: The communication dated 14 July 1995 was an adjudication order and a demand order.

Issue (ii): Whether the appellants were entitled to invoke the Kar Vivad Samadhan Scheme, 1998.

Analysis: Section 95 of the Scheme excluded cases where no appeal, reference, writ petition, or revision was pending on the relevant date. On 31 March 1998, no such proceeding was pending in relation to the demand in question. Once the liability had already been adjudicated and no pending proceeding existed, the statutory conditions for availing the Scheme were not satisfied.

Conclusion: The appellants were not entitled to the benefit of the Scheme.

Final Conclusion: The adjudication and demand were upheld, and the rejection of the declaration under the Scheme was sustained.

Ratio Decidendi: For the purposes of Section 11A(2) of the Central Excise Act, a communication that, after hearing the assessee, determines the duty payable and calls for payment of the balance constitutes adjudication; and a settlement scheme excluding cases with no pending proceeding cannot be invoked once the demand has already been adjudicated and no appeal, reference, writ petition, or revision is pending on the relevant date.

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