TaxTMI 
TaxTMI 
2019 (7) TMI 163
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....viso to Section 11A of the Central Excise Act along with interest and also imposed equal penalty under Section 11AC of the Central Excise Act. The Commissioner has also imposed a penalty of Rs. 6,50,000/- on shri K.P. Prakash, Vice President of the appellant under Rule 26 of the Central Excise Rules, 2002. 2.1. Briefly the facts of the present case are that the appellants are engaged in the manufacture of glass bottles falling under Central Excise Tariff Heading No.70109000. During the scrutiny of the records, it was observed that the appellant was clearing the finished goods to various buyers. It was further observed that among these buyers, the buyers viz. M/s. Khoday India Ltd. and M/s. Khoday RCA Industries appeared to be inter conne....
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.... iii. (a) the three units viz. (i) M/s. Khoday India Ltd., (ii) M/s. Khoday Glass Company and (iii) M/s. Khoday RCA Industries are inter related; (b) they are not adopting the valuation as required under the Rule 8 of Central Excise Valuation Rules (Determination of Price of Excisable Goods) 2000; (c) they had initially stated that these units are not inter related and their transactions are at arms length; (d) later they accepted that these units are inter related and they are adopting the valuation as per proviso to Rule 9 read with Rule 8 of Central Excise Valuation (Determination of Price of Excisable Goods) Rules, 2000, however, they were not adopting the valuation as per Rule 8 of Central Excise Valuation R....
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.... been passed without properly appreciating the facts, law and the binding judicial precedents. He further submitted that the only issue involved in the present case is the valuation of glass bottles for alcoholic drinks manufactured and cleared by the appellants to related persons as well as other 3rd party buyers. The allegation in the show-cause notice is that the value of clearances to related persons should have been arrived at on the basis of CAS-4 Certificate under the provisions of Rule 8 & 9 of Central Excise Valuation Rules, 2000 and the same has not been followed by the appellants, consequently the Department has confirmed the demand. Learned counsel further referred to Section 4(1)(b) of the Central Excise Act, 1944 read with Rul....
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....ed. Similarly in the case of Aquamall Water Solutions Ltd. Vs. CCE, Hyderabad-II [2005(182) ELT 1196 (Tri. Bang.)], the Tribunal has held that sales made to principal holding company as well as to independent dealers, then Rule 9 of Central Excise Valuation Rules 2000 is not applicable. On Revenue's appeal, the Hon'ble Supreme Court has accepted the principle that where goods are partly sold to a related person and partly to independent 3rd party, assessment should be on the basis of sale made to 3rd party. The Apex Court's decision is reported at 2006(193) ELT A197 (SC) and this decision has been followed by the Apex Court subsequently in the case of Ispat Industries Ltd. Vs. CCE [2006(202) ELT 561 (SC). 4.2. He further submitted that a....
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.... Lovely Food Industries Vs. CCE [2006(195) ELT 90] vi. Mopeds India Ltd. Vs. CCE [1991(56) ELT 241 (T)] vii. CCE Vs. Mopeds India Ltd. [1991(53) ELT A79 (SC)] 4.3. He further submitted that the Hon'ble Supreme Court has consistently held that extended period of 5 years is applicable only when something positive other than mere inaction or failure on the part of manufacturer is proved. Conscious or deliberate withholding of information by manufacturer is necessary to invoke larger limitation period. Expression "suppression of facts" in the proviso to Section 11A(1) are to be interpreted strictly, because, it has been used in the company of such strong words as fraud, collusion or wilfull misstatement. Where facts are kno....
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....ncern and confirmed the demand. Further we find that for the first time, the issue came to the knowledge of the Department in June 2002 when the statement of the Vice President of the appellant company was recorded but thereafter the Department did not do anything and in 2007 again the Department recorded the statement of the Vice President and issued the show-cause notice in July 2010 i.e. after about 8 years from the date of their knowledge about the supplies made to their sister concerns. We further note that the appellant has attached the audit report of two audits conducted in June 2006 and November 2006 wherein the audit party did not raise any objections with regard to this issue of valuation and clearances made to the sister concern....