The Customs, Central Excise and Service Tax Settlement Commission provides an alternate dispute resolution mechanism for taxpayers who wish to resolve tax disputes in a spirit of conciliation rather than litigation. Chapter V of the Central Excise Act 1944, Section 83 of the Finance Act, 1994 (Service Tax) and chapter XIV of the Customs Act 1962, contain provisions for “settlement of cases” through the Commission.
Any taxpayer to whom a show cause notice has been issued and the case is still to be adjudicated, can make an application in the prescribed form, containing a full disclosure of his accepted duty liability & interest, while arguing against those issues which he contests.
The Commission refers the Application of the Taxpaxyer to the authority who has issued the show cause notice for review and comments. Thereafter, the Commissioner (Investigation) appointed to each of the Benches of the Commission (Chennai, Delhi, Kolkata and Mumbai) examines the application before a hearing is fixed in the matter. The taxpayer or his duly authorised representative (which means an advocate or consultant or employee of the Applicant) are required to make an application in the forms notified for the purpose and shall be given opportunity to be heard in person. Thereafter, the Commission issues a speaking order on the application in final settlement of the tax dispute. Every order of settlement passed is conclusive as to the matters stated therein and no matter covered by such order is reopened in any proceeding by the Department.
The Commission is also duly empowered to grant immunities against prosecution, fines and penalties, where deemed fit.
Please refer to the Public Notice No. 01 / 2022 regarding the Chairman and Members appointed to all the Benches of the Commission.
Presently there is no provision for settlement of cases pertaining to GST matters.
The following category of cases are excluded from the purview of the Settlement Commission