2018 (8) TMI 317

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....bad-III. Appeal No. E/480/2009 was filed by the assessee while appeal No. E/481/2009 was filed by Shri G.S. Prasad Manager of the assessee and E/482/2009 was filed by Shri K. Saraswati Executive Director of the assessee. In the impugned Order-in- Original personal penalties were imposed on Smt. K. Saraswati & Shri G.S. Prasad under Rule 209 A of the Central Excise Rules, 1944. 2. Heard both sides and perused the records. 3. The appellant assessee manufactures plastic moulded chairs with the brand name of "POLYSET" and supplies the same to the M/s Polyset Plastic Limited (PPL) at an assessable value. M/s Polyset Plastic Limited in turn, sells these plastic chairs at a much higher price. After conducting investigation, a show cause noti....

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....he Commissioner by CESTAT. Thereafter, the matter was decided by the impugned Order-in-Original by the Commissioner. In para 36 of the Order-in-Original, the Commissioner has, after detailed examination of the terms and conditions of the agreement, held that the agreement is on principal to principal basis. He further ascertained that they do not in any way come near to the definition of the related persons as defied in Central Excise Law. Therefore, he held that the question of determining the assessable value on the basis of sale price of PPL does not arise and to this extent the allegations in the show cause notice are not sustainable. He found that the Department had alleged that M/s PPL supplied imported raw materials whose value will ....

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.... 7. Learned Counsel for the appellants submitted that the demand confirmed in the Order-in-Original is not sustainable because it travelled beyond the show cause notice. The show cause notice made allegations regarding the relationship between the appellant and M/s PPL and also regarding additional consideration for sale but the final demand in the show cause notice was raised only on the ground that the related parties and therefore the price at which PPL was selling the chairs should be taken the assessable value. There is no demand in the show cause notice on the grounds of additional consideration for sale. As the demand is not sustainable, interest and penalty on the appellant as well as penalties on the others are not sustainable ei....