TaxTMI 
TaxTMI 
2007 (9) TMI 151
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.... General of Anti-Evasion visited the premises of SLA, recovered records/documents maintained by them and recorded statements from the Managing Partner of SLA and General Manager of M/s. TAFE projects. M/s. TAFE projects (hereafter TPD) is a division of M/s. TAFE Ltd., for which also SLA had converted rough castings into tractor parts/components. On prima facie finding that SLA had evaded central excise duty payable on tractor parts manufactured and cleared to M/s. TPD. A show cause notice was issued which was adjudicated vide the impugned order. 2. In the impugned order the Commissioner found hat SLA used to received rough castings under erstwhile Rule 57F (3)/57(F) (4) challans and returned the manufactured tractor par....
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....n payment of duty. However, he found that SLA could not be said to have not paid the duty due intentionally to evade payment of duty. By evading duty no gain had accrued to SLA. In the instant case, SLA Could not be said to have evaded duty deliberately with any awareness of benefits or consequences. Accordingly, the Commissioner restricted the demand to six months only. As they were entitled to benefit of SSI notification for the above clearances he dropped the proposals in the Show Cause Notice. 5. Revenue has filed the instant appeal seeking orders to recover the duty not paid for clearances for the longer period as was proposed in the show cause notice, to impose equal amount of penalty under Section 11AC and ....
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....r in mala fide intentions. The above purpose is further strengthened by the fact that while they had chosen to correspond to other departments such as the Commercial Taxes department and the Income Tax department, they appear to have deliberately suppressed the knowledge from the Central Excise department. Therefore, it appears that the Commissioner ought to have invoked proviso to Section 11A(1) by taking into consideration the facts stated above and should have demanded duty accordingly. 4.5 It further appears that the Commissioner ought to have imposed penalty under Section 11AC and demanded interest under Section 11AB of the Act for the following reasons : 4.6 Section 11AC of the Act reads as 'where any duty of excise has not been....
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....records and the submissions made by the Departmental Representative. We find that SLA had been receiving rough castings and returning finished parts to M/s. TAFE Ltd., M/s. Hindustan Motors Ltd., M/s. Audco india Ltd., M/s. Lucas TVS Ltd. etc. They had been receiving inputs under Rule 57F(3) challans from these customers and regularly from TAFE. SLA were furnishing statutory returns to Income Tax department and Commercial Taxes department. It is obvious that SLA was aware of the central excise formalities and the requirement to pay duty on the goods manufactured by it. SLA had kept the department in the dark about their activities in relation to receipt of inputs on account of TPD and clearances of manufactured products to TPD. As the respo....