2017 (7) TMI 192

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....incurred by the appellant manufacturer to the assessable value of goods manufactured and cleared having nexus of the product development cost to the goods manufactured, appellant denies the same. 1.2 Appellants submit that duty has already been paid on these debit notes amounts without any dispute that duty is not payable (Page No.31) thereon. Therefore, there is no more necessity to determine the assessability and duty liability on these amounts for inclusion in the assessable value. In view such admitted position and the expenses of product development having been made by appellant which has direct nexus to manufacture, Revenue's contention that duty is leviable on the above amounts is correct and to this extent, we dismiss the appea....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....-cause notice brings out questionable modus operandi of the appellant, most particularly in paragraphs 14 & 15 of show cause notice. Understanding of the parties was to develop certain finished goods i.e. PPT, EN 52, etc., which was done by M/s.ISSAL for appellant manufacturer. For such development, debit notes appearing in page 28 and 31 of the appeal emerged. The appellant has not at all come out with clean hands to take into account the value addition to the goods cleared adding the debit note amounts in all fairness. Even the appellant did not co-operate with investigating authority. This is clear from the allegation of the Revenue. 6. Record reveals that when Shri O.P.Kakkar, who was well connected with the debit notes was summoned fo....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....(Mad). It is held that the penalty is punishment for an act of deliberate deception by an assessee with the intent to evade duty adopting any of the means mentioned in Section 11AC of the Central Excise Act, 1944. The facts and circumstances of the case as well as the modus operandi followed by the appellants in the present case demonstrate that they had deliberate intention to evade duty without inclusion of debit note amount in the assessable value of goods. This could not have been noticed without investigation. Therefore, the appellant does not deserve any consideration of leniency. Accordingly, penalty imposed under Section 11AC is confirmed. 8. The appellant submits that the Hon'ble Supreme Court in the case of Rashtriya Ispat Nigam ....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....public revenue on the pulpable plea of Revenue neutrality which is subject to scrutiny to grant Cenvat Credit to a different unit. 10. It may be stated that act of fraud on Revenue is always viewed seriously. "Fraud" and collusion vitiate even the most solemn proceedings in any civilized system of jurisprudence. It is a concept descriptive of human conduct either by letter or words, which includes the other person or authority to take a definite determinative stand as a response to the conduct of the former either by words or letter. It has been held by Apex Court in the case of Commissioner of Customs, Kandla v. Essar Oil Ltd. - 2004 (172) E.L.T. 433 (S.C.) that by "fraud" is meant an intention to deceive; whether it is from any expectati....