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2019 (4) TMI 1642 - AT - Central ExciseValuation - related party transaction - inter-connected undertakings - Section 4 (3) (b) (l) of the Central Excise Act, 1944 - whether the appellants and M/s. Cosmos Castings (I) Ltd. and others, as above, are related/ inter-connected undertakings and can be so considered merely on the basis of them being mentioned as ‘Related Party Disclosure’ in their balance sheets? HELD THAT:- The adjudicating authority has failed to appreciate that the provisions of Rule 9 of the Central Excise Valuation Rules, 2000 has been applied in a situation where the buyer is related either in sub-clause (ii), (iii) or (iv) of clause (b) of sub-section (3) of Section 4 of the Central Excise Act, 1944. For attracting the provisions of Rule 9 of the Central Excise Valuation Rules, 2000 the goods should be sold to related person as specified either in sub-clause (ii), (iii) or (iv) of Section 4(3)(b) of the Act and not to anyone else. Once law falsifies the liability of appellant in given circumstances, mere mention by appellant in its record that too in balance sheet only will not create any liability. More so when there is no effort by the Department to show whether price at which the duty liability has been discharged is influenced by relationship between the parties. Penalty - extended period of limitation - HELD THAT:- Penalty can be imposed only for contumacious conduct or for willful infringement of law, which are conspicuously absent on the part of the appellant in the facts of the present case. For the said reason only, the Department was not even entitled to invoke the extended period of limitation - penalty also set aside. Appeal allowed - decided in favor of appellant.
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