The Hindu : Business : ITC settlement `based on court suggestion'

Online edition of India's National Newspaper
Wednesday, Apr 06, 2005

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Business

ITC settlement `based on court suggestion'

By Our Special Correspondent

NEW DELHI, APRIL 5. The Centre's settlement with ITC over the long-pending Rs. 803-crore excise dispute was in keeping with a suggestion that emanated from the Supreme Court,'' the Union Finance Minister, P. Chidambaram, said here today.

Under the memorandum of settlement signed between the tobacco major and the Revenue Secretary, while the Government has given up its claims for an additional Rs. 450 crores as excise duties, the company too, will not seek a refund of Rs. 350 crores which it had already paid to the Excise Department as interim deposit, pending settlement of the dispute.

On these lines, the settlement has been filed before the adjudication officer, who would be passing the order today accepting the settlement, Mr Chidambaram said, while briefing newspersons on the issue.

"With the settlement, we are happy a long pending dispute has been resolved and doubly happy we have been able to resolve it in accordance with the SC suggestion,'' Mr. Chidambaram said.

The basis of the settlement went back to the case hearings in 2003 when the Supreme Court had suggested an end to the excise imbroglio between the two parties. However, at that time, as the Finance Ministry was unable to firm up its view on the issue and the court's verdict went in favour of ITC, the Government sought to overrule the apex court's order by promulgating an ordinance on January 25.

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