TaxTMI 
TaxTMI 
2013 (9) TMI 1010
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....w manufactured parts during the course of repairing and reconditioning of Hydraulic Cylinders on which they were neither paying Central Excise duty nor issuing Central Excise invoices. Searches were conducted at both the units of the Company on 19-3-2005 and certain documents were recovered under a Panchnama. Subsequently, appellant also got themselves registered under Service Tax with effect from 1-7-2003 and started paying Service Tax including the value of the parts utilised in the repairing and reconditioning of the Hydraulic Cylinders. A show cause notice dated 27-3-2006 was issued to the appellant demanding duty of Rs. 12,74,813/- with interest and penalty was also proposed under Section 11AC of the Central Excise Act, 1944. 2.1 Appellant deposited an amount of Rs. 4,08,000/- during the investigation on 19-3-2005 and Rs. 8,66,813/- on 12-5-2005 and also moved an application before Settlement Commission, Mumbai. The appellant's application was rejected by the Settlement Commission without passing any orders on the merits of the case. Therefore, appellant participated in the adjudication proceedings wherein it was inter alia, argued that adjudicating authority cannot go....
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.... Chemicals Limited v. UOI [2013 (287) E.L.T. 61 (Guj.)] (f) Delta International Limited v. CC [2012 (281) E.L.T. 400 (Cal.)] (g) Ispat Industries Limited v. CCE, Nagpur [2012 (280) E.L.T. 236 (Tri.-Mum.)] (h) Metal Products v. CCE, Ahmd. [2010 (262) E.L.T. 856 (Tri.-Ahmd.)] (i) Dhampur Sugar Mills Limited v. CCE, Meerut [2010 (260) E.L.T. 271 (Tri.-Del.)] (j) Vaspar Concepts (P) Limited v. CCE, Bangalore [2006 (199) E.L.T. 711 (Tri. Bang.)] (k) Curekraft Chemicals Pvt. Limited v. CCE, Chennai [2009 (247) E.L.T. 506 (Tri.-Chennai)] (l) Phoenix Yule Limited v. CCE, Kolkata [2009 (242) E.L.T. 284 (Tri.-Kolkata)] (ii) That demand is time barred as no specific grounds of suppression/misstatement, with intention to evade duty, have been explained in the Para 11 of the show cause notice. He argued that in view of the following case laws the demand is required to be set aside on improper issue of show cause notice and time b....
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....nded period is also applicable in view of Para 11 of the show cause notice. 5. Heard both sides and perused the case records. The main argument raised by the appellant is that show cause notice to Unit-II has not brought out facts clearly in order to be properly defended by the appellant inasmuch as the clubbing of clearance of Unit-I and II has not been explained in the body of the show cause notice and no show cause notice has been issued to Unit-I. It is appellant's case that by not projecting the case properly and building up of case of clubbing during adjudicating is an act beyond the scope of show cause notice and is required to be set aside in view of the relied upon judgments. First appellate authority has rejected this contention of the appellant by observing that this defence was not raised before the adjudicating authority and that there was no requirement of such allegation of clubbing the clearances as both the units belong to appellant. In this regard it is observed that the show cause notice, dated 27-3-2006 is addressed to the appellant is unit situated at 909A, GIDC, Phase IV, Naroda, Ahmedabad (Unit-II) and not to both the units of the Company. It is not c....
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....ere is no allegation of the respondents being parties to any arrangement. In any event, no material in that regard was placed on record. The show cause notice is the foundation on which the department has to build up its case. If the allegations in the show cause notice are not specific and are on the contrary vague, lack details and/or unintelligible that is sufficient to hold that the noticee was not given proper opportunity to meet the allegations indicated in the show cause notice. In the instant case, what the appellant has tried to highlight is the alleged connection between the various concerns. That is not sufficient to proceed against the respondents unless it is shown that they were parties to the arrangements, if any. As no sufficient material much less any material has been placed on record to substantiate the stand of the appellant, the conclusions of the Commissioner as affirmed by the CEGAT cannot be faulted." 5.2 While deciding the impropriety of a show cause notice, Calcutta High Court in the case of Delta International Limited v. CC [2012 (281) E.L.T. 400 (Cal.)] held in Para 16 as follows :- "16. In our opinion, whether they have the power to do s....
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....w of peculiar circumstances cited above, it is made clear to both sides that on the basis of governing facts and attending circumstances; this order has been passed against an ill-founded proceeding. With these words, appeal is allowed." 5.4 Similar view was taken by CESTAT, Kolkata Bench in the case of Phoenix Yule Limited v. CCE, Kolkata [2009 (242) E.L.T. 284 (Tri.-Kolkata)] in Para 5 as follow :- "5. We are unable to appreciate how the learned Commissioner (Appeals) lost sight of his Authority for calling information from the learned Assessing Authority to examine the time bar issue when his powers are co-terminus and co-extensive. Having such power he failed to exercise the same and made the appellate order fatal. Secondly we notice that observation of the learned Assessing Authority at page 14 of the Paper Book the fact that both the show cause notices were not for adjudication of a matter under Rule 57CC of Central Excise Rules, 1944. It is therefore not possible to hold that statutory Authority may pass order travelling beyond the scope of show cause notice when defence on a charge was not called for. It is elementary principle of jurisprudence that charges ....