Tribunal Grants Waiver & Stay, Acknowledging Independent Assessments & Prima Facie CaseDr. S.L. Peeran, Shri K.C. Mamgain, JJ. REPRESENTED BY S/Shri M.S. Nagaraja and T. Rajeswara Sastry, Advocates, for the Appellant. Shri P.M. Saleem, SDR, for the Respondent. [Order per : S.L. Peeran, Member (J) (Oral)]. - For the purpose of hearing the appeal, the appellants are required to pre-deposit duty amount of Rs. 45,222/-. The transaction value of the appellant company was rejected solely on the ground that the partners of the appellant company were also Directors of M/s.... ... ... Issues: Pre-deposit of duty amount, rejection of transaction value based on interconnected undertakings, consideration of arms length transaction, acceptance of plea in previous proceedings, department's dropping of charges, independent assessments.

Pre-deposit of duty amount:
The appellants were required to pre-deposit a duty amount of Rs. 45,222 for the appeal hearing. The rejection of the transaction value was based on the appellants being directors of another company, considered interconnected undertakings, leading to assessments under Rule 9 of the Valuation Rules.

Rejection of transaction value based on interconnected undertakings:
The rejection of the transaction value was contested by the appellants' counsel, arguing that being directors of another company does not justify rejecting the value. They emphasized that the transaction with the other company was at arms length without any extra consideration. The department had dropped charges in previous and subsequent proceedings, acknowledging the need to accept the transaction value.

Consideration of arms length transaction:
The appellants' counsel presented orders from previous proceedings where charges were dropped after accepting that the transaction value should be recognized. The appellants and the other company were deemed independent units by the department, leading to independent assessments. The tribunal noted that the department's actions in dropping charges indicated a prima facie case in favor of the appellants, granting a waiver of pre-deposit and staying the recovery.

In conclusion, the tribunal allowed the stay application, recognizing the appellants' prima facie case in light of the department's acceptance of independent assessments. The waiver of pre-deposit was granted, and the recovery was stayed, with the appeal scheduled to proceed in due course. Stay/Dispensation of pre-deposit - Demand - Related persons RS. ENTERPRISES Versus COMMISSIONER OF CENTRAL EXCISE, BELGAUM
Central Excise
2004 (8) TMI 419 - CESTAT, BANGALORE - 2004 (172) E.L.T. 414 (Tri. - Bang.)
CESTAT, BANGALORE - AT
Dated:- 2-8-2004
E/343/2004 - S/802/2004
Central Excise
Dr. S.L. Peeran, Shri K.C. Mamgain, JJ. REPRESENTED BY S/Shri M.S. Nagaraja and T. Rajeswara Sastry, Advocates, for the Appellant. Shri P.M. Saleem, SDR, for the Respondent. [Order per : S.L. Peeran, Member (J) (Oral)]. - For the purpose of hearing the appeal, the appellants are required to pre-deposit duty amount of Rs. 45,222/-. The transaction value of the appellant company was rejected solely on the ground that the partners of the appellant company were also Directors of M/s. M.S.P.L. and that they are 'Interconnected Undertakings' and hence the assessments are to be in terms of Rule 9 of the Valuation Rules. 2. The learned Counsel submits that mere fact of the appellants being the Directors of M/s. M.S.P.L. is no ground to reject the transaction value. He further submits that the transaction with M/s. M.S.P.L. was at arms length and no extra consideration has flown. He submits that the Department, with regard to the subsequent proceedings and also for the previous proceedings have dropped the charges and the demands made in the Show Cause Notice after accepting the plea that the transaction value is required to be accepted. He produces a copy of the Order-in-Original No. 11/2004, dated 31-3-2004 passed by the Joint Commissioner and also the Order-in-Original No. 24/2003, dated 26-6-2003 passed by the Assistant Commissioner in this regard. 3. The learned SDR submits that he would like to get comments on these orders produced by the learned Counsel. 4. On a careful consideration, we notice that the Department has dropped the proceedings against the appellants on the charge, which has been brought out in the proceedings, by accepting the fact that the appellants and M/s. M.S.P.L. are independent units and the assessments have to be independent. In view of the department having dropped the proceedings for earlier and subsequent period, the appellants have shown prima facie case in their favour. Hence the stay application is allowed granting waiver of pre-deposit and staying the recovery. Appeal to come up in its turn.
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