TaxTMI 
TaxTMI 
2019 (10) TMI 683
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....maller rolls. 1.2 Initially 19 show cause notices were issued to the Thane unit for the period October 1992 to December 1999 proposing to recover additional duty on the ground that the value at which the goods are cleared to the Daman unit is lower than the comparable market price. This Tribunal vide Order dated 10.04.2014 reported in 2014 (307) ELT 314 (Tri-Mumbai) set aside the demand raised on the Thane unit and upheld the valuation at which the goods were cleared to the Daman unit. The said order has been accepted by the department and attained finality. 1.3 Simultaneously a show cause notice was issued to the Thane unit proposing to recover central excise duty of Rs. 5,35,74,360/- on certain cash amount purported to have been recovered towards printing charges. The Commissioner of Central Excise, Mumbai IV vide Order in Original dated 04.12.1998 noted that since the issue was in relation to the Daman unit, the show cause notice issued by the Thane unit was without jurisdiction. Accordingly, a fresh show cause notice was issued on 12.01.1999 to the appellant herein for recovery of Rs. 5,20,18,003/- . 1.4 The show cause notice culminated into OIO No. 2/MP/Vapi/2000 date....
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....id not amount to manufacture. The impugned Order observes that the show cause notice was transferred to Call Book Register on 09.12.2004 to await the decision of Supreme Court in the case of Rajpurohit GMP India Limited, vs. CCE, Surat. 1.9 Thereafter, approximately 14 years thereafter, personal hearing notice was issued to the appellant at their Mumbai address on 18.06.2018. In response, an adjournment was sought by the appellant. Thereafter various correspondences were exchanged between the adjudicating authority and the authorised representative of the appellant for obtaining the copy of SCN and relied upon documents as has been mentioned the Impugned order. Copy of the SCN was thereafter given to the appellant. Since, the Witnesses did not appear for cross examination, the appellant requested the adjudicating authority to proceed with the hearing of the show cause notice as the same was pending for over 20 years. 1.10 The impugned order thereafter came to be passed by the adjudicating authority which has been challenged by way of the captioned appeal. 2. Shri Jitendra Motwani, Ld Counsel appearing on behalf of the Appellant made following submissions: - Activi....
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.... court, then the adjudicating authority was wrong to ignore the same as the law therein was passed in favour of the Appellant. It was alternatively submitted that there was no reason to keep the matter in call book for a period of around 10 years thereafter. - He further submitted that the reliance placed by the adjudicating authority on the decision of the Hon'ble Supreme Court in the case of Siddhartha Tubes v. CCE reported at 2000 (115) ELT 32(SC)wherein it is held that even where the process was not amounting to manufacture the expenditure incurred upto the factory gate clearances were includible in the assessable value is not correct inasmuch as the Hon'ble Supreme Court in later decision viz., Maruti Suzuki India Ltd., v. Commissioner of Central Excise, New Delhi has held that to invoke the valuation provisions under Section 4, there must be manufacture under Section 3. He further submitted that the decision in Siddhartha Tubes (supra) cannot be applied to the present case as facts are completely different therein in as much as in that case the pipes were manufactured and activity of galvanisation was carried out in the same factory whereas in the present case the ac....
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....s including written submissions filed by the Appellant post final hearing and perused the records. We find that there is no dispute regarding facts of the case between the revenue and the appellant in relation to activity carried out at the Daman factory. It is evident from the show cause notice, that the Appellant used to carry out post calendaring operations like checking/inspection of PVC films/sheets, cutting/slitting, printing and packing jumbo rolls into smaller rolls. The said fact is clear from the Show Cause Notice dated 12.01.1999 issued to the Appellant. Even the impugned order has confirmed the demand against the Appellant after holding that the aforesaid activity of printing carried out at Daman unit amounted to manufacture. 4.1 Keeping the above fact in mind, the moot question that needs to be decided is whether the activity carried out in the Daman factory of cutting/slitting of jumbo rolls of plain PVC Sheets into smaller rolls and printing of the same amounts to manufacture or otherwise. 4.2 We find that this Tribunal in the case of Bombay Kunststoff Pharma Supplies Pvt. Ltd v. CCE final order no. A/11571/11578/2018 dated 30.07.2018 has decided a similar issu....
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....decisions of the Hon'ble Supreme Court in the case of. a. Caprihans India Ltd. vs Commissioner 2010 (255) ELT A44(SC) b. Caprihans India Ltd. vs Commissioner of C.Ex. 2015 (11) TMI 1170-Supreme Court c. Commr. of C. Ex. Jaipur vs Pitamber Coated Paper Ltd. 2015 (319) ELT 357 (SC) d. UOI vs J.G. Glass Industries 1998 (97) ELT 5 (SC) e. UOI vs Alembic Glass Industries Ltd. 2010 (259) ELT 8 (SC) 4.4 Apart from the above, it would be important to reproduce the observation of the Adjudicating Authority in Para V, Internal Page 9 of the OIO: (V) On 09.12.2004, the impugned show cause notice was transferred to the Call Book Register citing the case of M/s. Rajpurohit GMP (I) Ltd. Silvassa and Others v. CCE Surat which was pending before the Hon'ble Apex Court for decision on the issue as to whether cutting and slitting of jumbo roll amount of manufacture or not. The impugned show cause notice was retrieved from the Call Book Register on 06.2.2018. A fresh personal hearing was granted on 18.06.2018 and a copy of PH letter was also sent to assessee's Mumbai address besides Daman address. In response, M/s. Economic Laws Practice vide t....
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....dispute that the matter was transferred to Call Book awaiting the aforesaid decision of the Hon'ble Supreme Court, the Adjudicating Authority was in error in ignoring the ratio laid down by the Hon'ble Supreme Court. In our view the issue in the said decision and in the case of Caprihans India Ltd. (supra) was identical to the case in hand. Similar issue was favourably decided by the Andhra Pradesh High court in the case of CCE & C, Hyderabad -IV V.s Rasmi Wax Coated Paper & Printing Industry reported in 2015 (325) E.L.T. 292 (A.P.). 4.7 The Adjudicating Authority in the impugned Order has held that the activity of printing amounts to manufacture by placing reliance on the decision of the Hon'ble Supreme Court in the case of Laminated Packaging v. CCE [1990 (49) ELT 326 (S.C.). On perusing the said decision we are of the view that the same will not be applicable to the facts of the present case. In Laminated packaging (supra) the activity of lamination of papers was held to be amounting to manufacture on the basis of the evidence led in support of the submission that plain kraft paper and laminated kraft paper are distinct and separate products known in the market. whereas in th....
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....ot completed after the process of galvanization. The facts in the present case are completely different as in the present case undisputedly the plain PVC sheets are manufactured in Thane unit and the activity of printing is carried out at a completely different factory/unit i.e. at Daman. The Daman unit receive already manufactured PVC sheets. In view thereof once it is held that PVC sheets cleared by Thane unit was a final product and activity of cutting/slitting and printing carried out at Daman unit did not amount to manufacture, then question of paying duty on printing charges by the Appellant did not arise. 4.10 Apart from the above we note that the Hon'ble Supreme Court in the case of Maruti Suzuki India Ltd., v. Commissioner of Central Excise, New Delhi reported in 2015(318) ELT 353 (SC) has held as under: 19. Shri Guru Krishna Kumar, learned senior counsel, then cited Siddhartha Tubes Ltd. v. Commissioner of Customs & Central Excise, Indore (M.P.) [(2005) 13 SCC 559 = 2006 (193) E.L.T. 6 (S.C.)]. This case again concerned manufacture of galvanised pipes. This Court, in a very significant passage, stated : "At the outset, we may state that value is the f....
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.... of which the demand is sought to be confirmed against the Appellant. The present investigation was initiated on the basis of an allegation that the Appellant was receiving some sale proceeds in cash. The show cause notice records that the demand is sought to be confirmed based on certain records which were seized from the residence of one Mr. Om Prakash who was working with the Auditors of Star Industries, Thane. Internal page 8 and 9 of the SCN reads as under: The demand is worked out on the basis of records/files no. 2 & 5 seized under panchanama on 11.7.96 from the residence of Shri. Om Prakash S. in the said files the assessee have maintained information of receipt of "F/FF" for the year 1993-94, 1994-95, 1995-96 & 1996-97 (till June 96'). Shri Om Prakash S, employee of Auditor of M/s Star Industries Ltd. in his statement recorded under section 14 of Central Excise Act, 1944 on 5.12.96 (Annexure III(xvi)) has stated that file no. 2 & 5 are seized from his residence on 11.7.96 contains information of "F/FF" transactions and monthwise calculation in respect of M/s Star Industries Ltd. Shri Om Prakash has signed all the papers of these files in a token of custodian of th....
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....ce at which goods were sold by the Appellant was as per the prevailing market rates during the period of dispute or the same were undervalued. Our view is supported by the decision of the Hon'ble Gujarat High court in the case of Commissioner v. Saakeen Alloys Pvt. Ltd. - 2014 (308) E.L.T. 655 (Guj.) wherein it is held as under: "7...In absence of any material reflecting the purchase of excessive raw material, shortage of finished goods, excess consumption of power like electricity, seizure of cash, etc., the Tribunal noted and held that there was nothing to bank upon except the bare confessional statements of the proprietor and of some of the persons connected with the manufacturing activities and such statements were retracted within no time of their recording. The Tribunal also noted the fact that the requisite opportunity of cross examination was also not made available so as to bring to the fore the true picture and therefore, it concluded against the Revenue observing that not permitting the cross-examination of a person in-charge of records of M/s. Sunrise Enterprises and absence of other cogent and positive evidences, would not permit it to sustain the demand of Rs....
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.... conclusively proved that the Appellant had received any amount in cash as alleged in the show cause notice. Be that as it may, the demand confirmed against the Appellant in any event is required to be set aside as the activity carried out at daman factory did not amount to manufacture. 4.18 Learned Advocate appearing on behalf of the Appellant further assailed the impugned order on the ground of delay. He has placed strong reliance on the decisions of Hon'ble Bombay High court in the case of Premier Limited (supra) which has been upheld by the Hon'ble Supreme Court. It is his submission that the Adjudicating Authority has wrongly held that the delay in passing the impugned order is because of the Appellant and drew our attention to a chart forming part of his written submission to state that there was no delay on the part of the Appellants. Admittedly in the present case a show cause notice was issued on 12.01.1999 and the same was adjudicated by the impugned order dated 05.02.2019 i.e. more than 20 years later. In between in first round of litigation an OIO was passed on 11.09.2000 which was set aside by this Tribunal in May 2001 when the matter was remanded for de novo adjudi....
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....s it is anxious to recover public money, the assessee is equally keen to face the consequences of legal proceedings. They do not wish to keep the proceedings lingering for they would want to concentrate on their business and not legal proceedings. It is a waste of their time as well. If an adjudication order is passed with reasonable expediency, even the assessees would arrange their affairs and in the event they are aggrieved, they would avail of the further remedies. Therefore, this is a power coupled with a duty and which the Revenue officials must realise. The earlier it is the better it would be for all concerned. 10. The second aspect which requires elaboration is, if the understanding of the Revenue is that it has to wait endlessly for the assessee to appear and make submissions, it is not the assessee's right to delay the matter. There is no vested right in prolonging the proceedings and none can claim that the law permits this course. Adjournments may be sought frequently but they are not to be granted liberally. That gives impression that the Revenue is not interested in proceeding with the matter, or rather has a vested interest in assisting the assessee. In the....
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....gned order by holding that the activity of cutting/ slitting/ printing of PVC Sheet carried out at Daman unit did not amount to manufacture and the evidence relied upon by the department in show cause notice is not conclusive to prove receipt of cash and or charge of undervaluation against the Appellant. 6. On the issue of limitation also we find considerable force in the submission of the Appellant that the facts were within the knowledge of the revenue inasmuch as the 19 notices issued to Thane unit for the period 1992 to 1999 were dropped on the basis of the report of the Daman Commissionerate to the effect that duty at Rs. 3 Per Kg is discharged on printing activity. It is not open for the revenue to claim ignorance of facts when the Thane unit was earlier issued an SCNs for undervaluation and the proposal of the Revenue was to include the value of printing charges in the assessable value of the plain PVC Sheets manufactured at Thane. The period in the present case is covered in the period for which 19 notices were issued to Thane. It is also a matter of fact that the demand raised in the said 19 show cause notices was ultimately set aside by this Tribunal vide order dated 1....