TaxTMI 
TaxTMI 
2022 (7) TMI 88
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....LE COURT may be pleased to pass such other and further orders may be deemed just and proper in the facts and circumstances of the present case." 2. We have heard Mr. Sunit M. Shah, the learned Counsel assisted by Mr. Vasim Mansuri, the learned advocate appearing for the writ applicant and Mr. Nikunt K Raval, the learned Standing Counsel appearing for the respondents Nos. 2 and 3 respectively. 3. It appears from the materials on record that there was a partnership firm running in the name of M/s. Sunshine Corporation. Two individuals namely (1) Sarfarazbhai H. Rangwala and (2) Mumtajbiwi Y. Rangwala were the partners of the said firm. M/s. Sunshine Corporation came to be dissolved on 31.3.2004. A new firm in the name of M/s. Sunshine Paints (writ applicant) came into existence from 1.4.2004. The writ applicant started operating from the very same business premises from where M/s. Sunshine Corporation used to operate. Two individuals namely (1) Saeedkhan H. Rangwala and (2) Majeed Y. Rangwala are the partners of the writ applicant firm. There is one another company in the name of M/s.Spraylac Colour figuring in this litigation. It is a trading company and two individuals namely....
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....paid by them on illicity and clandestine removal of excisable goods, as detained in Annexure "a-1", "A-3", "A-5" and A-6" and aummarized in Annexure "A" to this notice should not be demanded and recovered from them under sub-section (1) of Section 11A of the Central Excise Act, 1944 by invoking the extended period of five years as provided in the proviso to the said sub-section. (ii) As they have already paid an amount of Rs.9,53,814/- towards their duty liability during investigation, why the same should not be appropriated towards the aforesaid amount recoverable from them. (iii) Penalty should not be imposed upon them under Section 11AC of the Central Excise Act, 1944 and Rule 173Q of the erstwhile Central Excise Rules, 1944, Rule 25 of the Central Excise (No.2) Rules, 2001 and Rule 25 of the Central Excise Rules, 2002 read with Section 38A of the Act ibid. (iv) Interest as applicable under Section 11AB of the Central Excise Act, 1944 should not be recovered from them. 44. Shri Sarafranjbhai H. Rangwala and Ms. Mumtajbiwi Y. Rangwala, Partners of M/s. Sunshine Corporation; Shri Saeedkhan H. Rangwala and Shri Majeed Y. Rangwala partners of M/s. Sunshine....
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....ttlement commission for the purpose of considering waiver of penalty and fine. The relevant part of the order dated 25.9.2008 reads thus:- "Mr. Manish R. Bhatt, learned Senior Counsel for the petitioners has referred to the order of the Settlement Commission and drawn the attention of this Court to the observations made by the Settlement Commission in paragraph 6.2 of the order which reads as under :- "The Bench further finds that the applicant has fulfilled all the conditions for admission of the case in terms of subsection (1) of Section 32E of the Act. Accordingly, the applications filed by the applicant and the coapplicants are allowed to the proceeded with under sub-section (1) of Section 32F of the Act." Referring to the penalty, it is observed as under :- "The Bench imposes penalty on the applicant and the co-applicants as below : (a) Penalty of Rs.15 Lacs on the applicant, M/s.Sunshine Pints. Case law prohibits penalties on the firm as well as the partners. Therefore, no penalty is called for against partners. (b) Penalty of Rs.15 Lacs on the coapplicant, Shri Ibrahim Rangwala (Partner of M/s. Spraylac Colour Company)." ....
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....igned for not granting such a benefit to the petitioners herein. Further, there are no specific reasons assigned for the same for deviating from the earlier course justifying the exercise of discretion for not weaving which is normally exercised in such a situation. 10.Therefore, when no reasons are assigned by the Settlement Commission for rejecting such a claim for waiver or fine and penalty and in light of the settled legal position, particularly, the judgment of the Apex Court referred to and relied upon by the petitioners in the case of State of Punjab V/s. Bhag Singh, 2004 (164) ELT 137 (S.C.) and which has also been followed consistently. 11.This very principles have been reiterated by the Hon'ble Supreme Court and has been found in various decisions including the judgment of the Hon'ble Supreme Court in the case of Ran Singh and another V/s. State of Haryana and others, (2008) 4 SCC 70 wherein the Hon'ble Supreme Court has observed in paragraph 10 as under :- "10. 5.......Reasons introduce clarity in an order. On plainest reasons, howsoever brief, in its order indicative of an application of its mind, ....... The absence of reasons has....
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....tute may not specify but for the purpose of ultimate ends of justice and the fairness, the High Court may have to interfere with such an order. Therefore, when the order is without any reason or is laconic or has failed to observe, the bare principles of natural justice, it is required to be set aside. Therefore, the submissions made by learned Standing Counsel Ms. Ami Yajnik on this count cannot be accepted. 15.Therefore, keeping in view the totality of the circumstances, we deem it expedient and appropriate that ends of justice would be served in case the matters on the issue of claim of waiver of penalty and fine is remitted back to the Settlement Commission for reconsideration. 16.Accordingly, present group of petitions stand allowed. The orders passed by the Settlement Commission dated 05.10.2007 so far as Special Civil Application Nos.4896 to 4900 of 2008 are concerned and the order dated 08.10.2007 passed by the Settlement Commission so far as Special Civil Application No.28680 of 2007 and the order dated 11.04.2007 passed by the Settlement Commission so far as Special Civil Application No.6127 of 2008 are hereby set aside to the extent it challenges or con....
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....gnated Committee, Vth Floor, GST Bhavan, Ahmedabad - 380015 Date: 17th December, 2019 Sub: Form SVLDRS - 1 of "Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019" Dear Sir, 1. With reference to above subject we submitted our declaration in form SVLDRS 1 on 20.11.2019, the same was replied to us on 07.12.2019 with the following remarks within the rectangle: Remarks Assessee has paid Rs.22140800 vide various challans after filing returns for pending dues for returns Jul 2014 to may 2017 (Except mar 2015 where no declaration filed) of Rs.32873440. Paid amounts adjusted from Jul 2014 returns onward leading to full payment on returns from Jul 2014 to Jul 2016 (other than mar 2015) and pending payment for Aug 2016 onwards. The remarks on 2nd page is: Remarks: other noticee application rejected. 2. The reasons shown in the remark of declaration made by Sunshine Paints is not relevant. We have paid the entire duty amount of Rs.51,76,676/- and also an interest amount of Rs.11,87,041/-. Copies of the challans for both are enclosed herewith for your ready reference. ....
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....larant was for an amount of duty of Rs.1000 and an amount of penalty of Rs.100. The order was for an amount of duty of Rs.1000 and amount of penalty of Rs.100. The declarant files an appeal against this order. The amount of duty which is being disputed is Rs.1000 and hence the tax dues are Rs.1000. Illustration 2: The show cause notice to a declarant was for an amount of duty of Rs.1000 and an amount of penalty of Rs.100. The order was for an amount of duty of Rs.900 and penalty of Rs. 90. The declarant files an appeal against this order. The amount of duty which is being disputed is Rs. 900 and hence tax dues are Rs.900. Illustration 3: The show cause notice to a declarant was for an amount of duty of Rs.1000 and an amount of penalty of Rs.100. The order was for an amount of duty of Rs. 900 and penalty of Rs. 90. The declarant files an appeal against this order of determination. The departmental appeal is for an amount of duty of Rs. 100 and penalty of Rs. 10. The amount of duty which is being disputed is Rs. 900 plus Rs. 100 i.e Rs. 1000 and hence tax dues are Rs. 1000. Illustration 4: The show cause notice to a declarant was for an amount of duty of Rs....
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....untary disclosure,- (i) after being subjected to any enquiry or investigation or audit; or (ii) having filed a return under the indirect tax enactment, wherein he has indicated an amount of duty as payable, but has not paid it; (g) who have filed an application in the Settlement Commission for settlement of a case; (h) persons seeking to make declarations with respect to excisable goods set forth in the Fourth Schedule to the Central Excise Act, 1944." 17. The proviso to sub-section (b) of Section 123 is important. It provides that if the notice has been issued to the declarant and other persons making them jointly and severally liable for an amount then the amount indicated in the said notice as jointly and severally payable shall be taken to be the amount of duty payable by the declarant. 18. Indisputably one composite show cause notice was issued in the case on hand. The writ applicant, in our view cannot be held liable for the alleged duty short paid by M/s Sunshine Corporation. In the show cause notice nowhere it has been stated that M/s Sunshine Paints (writ applicant) is jointly and severally liable for the alleged duty short paid by....
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....se notice for late fee or penalty only, and the amount of duty in the said notice has been paid or is 'nil', then, the entire amount of late fee or penalty will be waived. This section, inter alia, covers cases of penal action against co-noticees. In case of a show cause notice demanding duty/ tax from main taxpayer and proposing penal action against co-noticees, it is clarified that the co-noticees can't avail the benefits of the scheme till such time the duty demand is not settled. Once the main noticee discharges the duty demand the co-noticees can apply under this Scheme. This will also cover cases where the main noticee has settled the matter before the Settlement Commission and paid the dues and in which co-noticees were not a party to the proceedings before the Settlement Commission." The above clarification specified that the co-noticee would be entitled to file an application under the scheme only if the main noticee had discharged the duty demand. In the instant case, the main noticee i.e. M/s Sunshine Corporation had not discharged the duty demand and as such the application of the petitioner i.e. co-noticee to the show cause notice has been rejected. 7....
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....he instant case, the show cause notice was issued wherein demand was raised on M/s Sunshine Corporation as well as M/s Sunshine Paints. The main noticee in the show cause notice was M/s Sunshine Corporation and M/s Sunshine Paints is the co-noticee. This is especially so in light of the fact that M/s Sunshine Paints had taken over the company viz. M/s Sunshine Corporation and continued business by issuing the invoices of M/s Sunshine Corporation. This has been charged at para 37.1 of the show cause notice. Thus, in view of such facts, M/s Sunshine Corporation is the co-noticee in the case and was not entitled to file a declaration under the scheme since the main noticee had not discharged the duty demand." 22. Thus, from the aforesaid, it is apparent that the Sunshine Corporation is being considered as principal noticee whereas M/s. Sunshine Paints (writ applicant) has been considered as the co-noticee for the sole reason that the writ applicant took over the business of M/s. Sunshine Corporation. As noted above, for the period during which M/s. Sunshine Corporation incurred liability writ applicant firm was not even in existence and in such circumstances, We are of the view tha....