TaxTMI 
TaxTMI 
2012 (3) TMI 360
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....are shareholders of SFPL (about 4.38%) and are alleged to be controlling other group companies M/s. Sahi Export House, Faridabad, M/s. Delhi Brass & Metal Works, Faridabad, M/s. Mangumal Fatehchand, New Delhi, and M/s. Sarla Fashion Garments, who, in turn, have substantial shareholding in SFPL. They process fabrics on job work basis and on their own account. The fabrics processed on their own account are partly cleared for export and partly cleared to their own Group Companies, who use the same for captive consumption. The period of dispute in this case is from 1-3-2001 to 8-7-2004. During the period of dispute, the appellant company in respect of clearances of fabrics processed on job work basis was paying duty in terms of the judgment of ....
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....customers which had not been included in the assessable value. The duty on this amount is Rs. 2,24,934/-. 1.4 Besides this, it is also alleged by the department that during the period 2001-2002 to 2003-2004, the appellant company had provided the services of C&F agent to their clients on which neither any Service Tax has been paid nor did they obtain Service Tax registration or filed ST-3 returns. The Service Tax alleged to have been evaded is Rs. 3,28,747/-. 1.5 It is on the above basis that a show cause notice dated 29-3-2006 was issued to the appellant company as well as to Shri Harish Ahuja and Mrs. Sarla Ahuja, for - (a) Recovery of allegedly short paid duty amounting to Rs. 6,87,17,865/- (Rs.....
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....ile penalty of Rs. 6,89,78,871/- was imposed on the appellant company under Section 11AC of Central Excise Act, 1994, penalty of Rs. 1,000/-; Rs. 200/- per day for the period of failure to pay the Service Tax and Rs. 3,28,747/- was imposed on the Appellant Company under Section 75A, 76 and 78 respectively of the Finance Act, 1994; (d) Penalty of Rs. 50 lakhs each was imposed on Shri Harish Ahuja and Mrs. Sarla Ahuja under Rule 209A of the Central Excise Rules, 1944/Rule 26 of the Central Excise Rules, 2001/2002. 1.7 Against the above order of the Commissioner, these three appeals have been filed along with stay applications. 3. Heard both sides. 4. Though this matter was listed only for hearing of the ....
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....V Standard of ICWAI, that in terms of the Board's Circular No. 692/8/2003-CX., dated 13-2-2003, the cost of production is to be determined on the basis of CAS-IV Standard, that in terms of the judgment of Apex Court in the case of C.C.E. v. Cadbury India Limited reported in 2006 (200) E.L.T. 353 (S.C.) even for the period prior to the date of the Board's circular, wherever the cost for the purpose of determining the value of the clearances for captive consumption is required to be determined, the same must be determined in accordance with CAS-IV Standard, that the same view has been taken by the Apex Court in its subsequent judgment in the case of C.C.E. v. Raymonds Ltd. reported in 2006 (204) E.L.T. 3 (S.C.), that in terms of the Costing S....
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....tant under Rule 14A of the Central Excise Rules, but no Cost Accountant was appointed for redetermining the cost, that the appellant during the period 1999-2000 period, had declared the details of their group companies and their relationship with them and also the fact of sales to those companies, that in view of this, in respect of the alleged short payment of duty on the clearances to the groups companies, the longer limitation period can not be invoked by alleging suppression of facts and hence, the show cause notice dated 29-3-2001 issued for the recovery of allegedly short paid duty during period 1-3-2006 to 8-7-2004 is time-barred, that in view of this, the duty demand of Rs. 6,89,79,871/- is without any basis and is not sustainable, ....
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.... in the hands of job worker plus job charges plus job worker's profit. The amount and designing charges would be part of the job charges. However, there is no scope for adding losses suffered by company or notional interest on interest free loans to this cost. In view of this, sofar differential duty in respect of the clearances of goods manufactured on job work basis is concerned, the assessable value has to be determined strictly in terms of the Apex Court judgment in Ujagar Paints (supra). However, if the Department doubts the assessable value of the job- work goods, the same can be got verified by appointing a Cost Accountant under Section 14A of the Central Excise Act, 1944. 9. As regards clearance to other group company allege....