Full and true disclosure is mandatory for settlement; selective admission of duty liability defeats jurisdiction under excise settlement provisions.

Settlement under the Central Excise Act requires a full and true disclosure of the entire undisclosed duty liability, including the manner of its derivation and the amount accepted as payable. Where the show cause notice alleged suppression, wilful misstatement and related evasion for the whole demand, a partial admission tied to a different period did not amount to candid disclosure of the full liability. The Commission held that this defect went to jurisdiction, because full and true disclosure is a condition precedent to the matter proceeding under the settlement provisions. The application was therefore rejected as not maintainable.

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Issues: Whether the settlement application disclosed the entire duty liability in a full and true manner so as to justify proceeding with the application under the settlement provisions of the Central Excise Act, 1944.

Analysis: The statutory scheme requires an applicant to make a full and true disclosure of previously undisclosed duty liability, the manner of derivation, and the additional amount accepted as payable. The case before the Commission arose from a show cause notice alleging suppression, wilful misstatement, collusion, and related evasion for the entire period in dispute. The applicant offered only a part of the demanded duty on the footing of a six-month period treated as a reasonable period, but that admission was not tied to the six months preceding the notice and was instead linked to a later manufacturing period. On the facts, the same allegations and the same basis for invoking the extended period applied to the whole demand, so partial admission did not amount to a candid disclosure of the entire liability. The application was therefore found to suffer from want of full and true disclosure, which is a condition precedent for the settlement forum's jurisdiction to allow the matter to proceed.

Conclusion: The settlement application was not maintainable for proceeding further and was rejected against the applicant and co-noticees.

Ratio Decidendi: An application for settlement under the Central Excise settlement provisions can proceed only when the applicant makes a full and true disclosure of the entire undisclosed duty liability; a selective or partial admission in a case founded on the same allegations for the whole demand is insufficient and defeats jurisdiction.

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