TaxTMI 
TaxTMI 
2011 (5) TMI 720
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....via, father of Shri Samir Batavia. The allegation against M/s. Supreme Rubber Industries is that during the period of dispute from 1997-98 and 1999-2000, they were manufacturing excisable goods affixed with brand name of other persons but were still availing S.S.I. exemption, while in terms of the provisions of the Exemption Notification No. 1/93-C.E in force during the period of dispute, they were not eligible for S.S.I. exemption.M/s. Batovia Brothers were getting orders from various traders for the manufacture of moulded rubber automobile parts affixed with their brand name along with their labels, which was being supplied to M/s. Supreme Rubber Industries alongwith rubber procured from the market. M/s. Supreme Rubber Industries after manufacturing the rubber parts affixed the brand name of other persons and were clearing the same to M/s. Batavia Brothers. In view of the above facts, a show-cause notice dated 24.12.1999 was issued to M/s. Supreme Rubber Industries, M/s. Batavia Brothers and four traders namely M/s. Vishal Auto Products, Jyoti Auto Industries, Simplex Automobiles, Kawal Rubber Moulders for :- (i) recovery of short paid Central Excise duty amounting to Rs.1,86....
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....d from M/s. Batavia Brothers, who are receiving the orders for manufacture of rubber articles from various traders, that M/s. Supreme Rubber Industries were manufacturing rubber moulded articles as per orders and were affixing the labels supplied by the owner of the goods, that M/s. Supreme Rubber Industries were availing full duty exemption under S.S.I exemption notification, that they were under the impression that since the brand names do belong to traders, not to the manufactures, they are eligible for the S.S.I exemption, that because of this belief only, no duty was paid, that in any case the duty on the goods would be chargeable on the cost of raw material plus Job charges in terms of Hon'ble Supreme Court's Judgement in the case of Ujagar Prints etc. vs. Union of India & Others - 1989 (39) ELT 493 (S.C.), while the department has charged duty on the selling price of the rubber moulded articles by their owners, which is not correct, that it is only in terms of Rule 10A of the Central Excise (Valuation) Rules, 2000 which was introduced with effect from 01.04.2007 that in case of manufacture of goods on jobwork basis, the duty is required to be paid on the pr....
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....tative, defended the impugned order by reiterating the findings of the Commissioner (Appeals) and emphasized that both the manufacturer M/s. Supreme Rubber Industries and the raw material supplier M/s. Batavia Brothers are controlled by the same group of persons and while M/s. Supreme Rubber Industries is owned by Shri Samir Batavia, M/s. Batavia Brothers is owned by the father of Shri Samir Batavia, Shri Pravinchandra Batavia, that Shri Pravinchandra Batavia is also the manager of M/s. Supreme Rubber Industries, that since the M/s. Supreme Rubber Industries were clearing the goods after affixing brand name of other persons, they were not eligible for S.S.I. exemption, that the appellant have suppressed the fact of affixation of brand name of other persons from the department and, hence longer limitation period has been correctly invoked, interest on duty under Section 11AB has been correctly demanded and penalty under Section 11AC has been correctly imposed that there is also evidence that the customers of M/s. Batavia Brothers were destroying the challans after receiving the finished goods by them which indicates that the M/s. Supreme Rubber Industries had suppressed the va....
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....been stated in para 4 of the Judgement of the Larger Bench of the Tribunal in the case of M/s. Namtech Systems Ltd. (supra) there were conflicting judgements on the issue involved in this case. As held by the Apex Court in the case of Mentha & Allied Products Ltd. (supra), longer period of limitation under Section 11A would not be available in a situation where on some issue of excisability, classification, valuation or rate of duty involved in a case of alleged short payment of duty, there are conflicting judgements of Tribunal and High Courts. We find that the same view has been taken by the Hon'ble Supreme Court in the case of Continental Foundation Jt. Venture (supra) (para 11 of the Judgement). We, therefore, hold that longer limitation period under proviso to Section 11A was not available to the department and the duty can be demanded only for normal limitation period. 7. Since during the period of dispute, the interest on short paid/not paid duty under Section 11AB and imposition of penalty under Section 11AC was linked to such short payment/non-payment being due to fraud, wilful suppression of facts, mis-statement etc. with intent to evade paymen....