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of <h1>Appellate Tribunal upholds duty demand on Samanjas Udyog, penalties confirmed, Chandresha's penalty overturned.</h1> <h3>SAMANJAS UDYOG Versus COMMISSIONER OF CUS. & C. EX., RAJKOT</h3> The Appellate Tribunal upheld the duty demand against M/s. Samanjas Udyog, confirming the clubbing of clearances with Atharva Udyog. Penalties under ... Demand and penalty - SSI Exemption - Clubbing of clearances - Penalty on proprietor of job worker Issues:Confirmation of duty demand under Section 11A(1) against M/s. Samanjas Udyog, clubbing of clearances with Atharva Udyog, imposition of penalties under various sections, absence of show cause notice to Atharva Udyog, validity of penalty on Shri D.D. Chandresha.Analysis:The Appellate Tribunal upheld the duty demand of Rs. 1,18,146 against M/s. Samanjas Udyog, citing that the value of clearances of brass bearing cages by Atharva Udyog needed to be clubbed with Samanjas Udyog's clearances. This was due to Atharva Udyog being considered a dummy unit set up by Samanjas Udyog to wrongfully avail SSI exemption. Penalties were imposed under Section 11AC of the Central Excise Act and Rule 173Q(1) of the Central Excise Rules, 1944, along with a penalty on Shri D.D. Chandresha, a job worker for Samanjas Udyog.The argument presented was the lack of a show cause notice issued to Atharva Udyog proposing denial of the SSI exemption benefit. The Tribunal dismissed this argument, stating that Rule 209A was invoked in the notice to Atharva Udyog due to its involvement in evading excise duty by falsely presenting itself as an independent unit. The Tribunal emphasized that Atharva Udyog was merely existing on paper and was a dummy unit of Samanjas Udyog, justifying the penalty imposed under Rule 209A.Regarding the penalty on Shri D.D. Chandresha, the Tribunal disagreed with the initial finding that his actions implied knowledge of dealing with excisable goods liable for confiscation. They overturned the penalty on him, stating that his actions were not sufficient to attribute such knowledge. Consequently, the appeal of Samanjas Udyog was dismissed, upholding the duty demand and penalties, while the appeal of Shri D.D. Chandresha was allowed, setting aside the penalty imposed on him.In conclusion, the Tribunal's judgment affirmed the duty demand against Samanjas Udyog, upheld the penalties imposed, justified the absence of a show cause notice to Atharva Udyog, and overturned the penalty on Shri D.D. Chandresha due to insufficient evidence of his knowledge regarding the excisable goods involved.
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