TaxTMI 
TaxTMI 
2009 (2) TMI 331
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....e, there is a short levy on the plywood manufactured and cleared by them. Also there is a short levy on the excess amount collected from the customers during 2000-2001. The Director General of Central Excise Intelligence (DGCEI) had carried out certain investigations and recovered a lot of documents/records from M/s. SP. All the three units have common partners who are family members. On the basis of the records, Revenue proceeded against the appellants for demand of duty of Rs. 7,54,287/-. The lower authority confirmed the demand, imposed equal penalty under Section 11AC. The land, plant and machinery used in the manufacture of the excisable goods were held liable to be confiscated and a Redemption Fine of Rs. 10,000/- was imposed. Penalty of Rs. 5,000/- each was imposed on S/Shri M.K. Hamza and M.K. Shoukath under Rule 209A of the Central Excise Rules, 1944 read with Section 38A of the Central Excise Act, 1944. The appellants approached the Commissioner (Appeals). The Commissioner (Appeals) passed the impugned order confirming the Order-in-Original. The appellants are highly aggrieved over the impugned order and hence, they have come before this Tribunal for relief. 4. The learn....
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....ere records to prove existence of the independent units and separate financial dealings, which all go to establish the independent nature of the units in question and hence, the value of job work undertaken could not have been included to the value of the appellant. All these submissions have been overlooked and, therefore, the order is bad and illegal. (vi) The appellant had undertaken job work for RTI. Therefore, these clearances are in fact the clearances of RTI. Therefore, the duty liability would be only on RTI and not on the appellant. This point has not been appreciated by the learned Commissioner. (vii) The very fact that the goods were sent by the RTI for job work in accordance with Notifications 83/1994, 84/1994 indicates that the onus to pay duty will be on the supplier of goods and not on the appellants. (viii) Without prejudice to the above contention, even if duty is to be paid, the valuation should be in the light of the Ujagar Prints case [1988 (38) E.L.T. 535 (S.C.)]. (ix) Based on the statement of one Shri V.H. Harshad regarding the receipt of amount of Rs. 6,48,494/-, the value was included for total clearances. This person was not produced for cross examinat....
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.... E.L.T. 109 (T); (g) Movika Pharmaceuticals - 1998 (27) RLT 230; (h) New Vikram Cement - 1998 (104) E.L.T. 66 (Tri.) = 1998 (27) RLT 474; (i) Jana Jeevan Foods (P) Ltd. - 1999 (107) E.L.T. 388 (Tri.) = 1999 (30) RLT 686; (j) Sterlite Industries (I) Ltd. - 1998 (103) E.L.T. 391 (Tri.) = 1998 (27) RLT 419 (T); (k) Gurunanak Steel & Allied Industries - 2001 (42) RLT 37(T); (l) Aldowin & Others - 2003 (156) E.L.T. 254 (Tri.) = 2003 (56) RLT 620 (T) and (m) Surat Textiles Mills Ltd. - 2004 (167) E.L.T. 379 (S.C.) = 2004 (62) RLT 351 (SC) (xiii) In view of the above, it was submitted that the imposition of equivalent penalty is highly illegal. The following case-laws were relied on : (a) Super Tik Industries - 2002 (147) E.L.T. 993 (Tri.- Bang.); (b) Ambuja Synthetics Mills Ltd. - 2004 (175) E.L.T. 85 (Guj.) = 2002 (50) RLT 133; (c) Beauty Dyers v. UOI - 2004 (163) E.L.T. 28 (Mad.) = 2002 (52) RLT 644 (HC); (d) Escorts JCB Ltd. - 2000 (118) E.L.T. 650 (Tri.) = 1999 (35) RLT 9 (T); (e) Arti Textiles v. CCE - 2002 (144) E.L.T. 207 (T); (f) BPCL v. CCE - 2002 (139) E.L.T. 382 (Tri.) = 2002 (48) RLT 979 (T); (f) CCE v. Kuchal Udyog - 2000 (115) E.L.T. 778 (T); and (g) State o....
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....ted by the Revenue. On the basis of the detailed investigation, certain incriminating records were found and after analyzing the records, the Revenue came to the conclusion that there was evasion of duty by showing certain clearances by the appellant unit viz. M/s. Southern Plywoods as the clearances of M/s. RTI. We find that M/s. Southern Plywoods is a SSI Unit set up in the year 1995 for the manufacture of commercial plywood and block board. From the records, we find that they had machinery installed for the manufacture of plywood and block board. The partners of the appellant unit are Shri M.K. Shoukath and his brother Shri M.K. Hamza. 6.1 The second unit viz. M/s. Razia Timber Industries is another SSI located in a separate building in Mukickal, which commenced its operations in 1992. The partners of RTI are one Shri M.K. Hamza; Shri M.K. Shoukath and Shri M.H. Riyaz, who is the son of Shri M.K. Hamza. It is seen from the records that the following machinery have been installed in M/s. RTI. (i) Peeling machine(4":1 number) (ii) Band saw (1 No.) (iii) Resaw (1 No.) (iv) Clippers (4 Nos.) (v) Gross cutter (1 No.) 6.2 It has been seen from the records that M/s. RTI manufact....
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.... the appellant M/s. SP to manufacture plywood on job work basis and they have also given evidences of the pressing charges paid to M/s. SP as well as to the other unit M/s. HP. These points have not been taken into account by the lower authorities. Further, even if the Department's case is that M/s. RTI had not at all manufactured anything and it is only the appellant who manufactured and simply used the invoice of M/s. RTI to show that they are the clearances of M/s. RTI, in that case also, in our view, the Show Cause Notice ought to have been issued to M/s. RTI. The Department, at the stage of Show Cause Notice, only makes allegation and it is for the Adjudicating Authority to consider all the facts and arrive at a conclusion. Even at the investigation or Show Cause Notice stage, the Revenue cannot assume that there is no need for issue of Show Cause Notice to M/s. RTI especially, when the fact that M/s. RTI is an independent unit is not in dispute. Even if department says that the clearances made in the name of M/s. RTI are not the actual production of M/s. RTI, still, in order to observe the principles of Natural Justice, a Show Cause Notice ought to have been issued to M/s. RT....