TMI Blog1999 (11) TMI 283X X X X Extracts X X X X X X X X Extracts X X X X ..... as done after granting stay and waiver of the deposit of the duty amounting to Rs. 72,405.30 and the penalties imposed on the appellants. 2. M/s. Jalla Industries manufactured motor vehicle horns. They were operating under the benefit of Notification 1/93 under which first clearances upto the value of Rs. 30,00,000/- did not attract duty. Their premises were visited on 5-4-1994. During the visit it was seen that M/s. Jalla Industries had purchased horns valued at Rs. 5.28 lakhs from M/s. Veejay Corporation, Mumbai, during the period from 16-2-1994 to 30-3-1994. The officers noticed that the value of clearances shown by M/s. Jalla Industries during the year 1993-94 was Rs. 28,66,614.50. The premises of M/s. Veejay Corporation were visited ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at it was a case of fragmentation. He confirmed the demand and imposed penalty. Before the Commissioner (Appeals) various grounds were raised. The main ground was of limitation. It was claimed that although the department had knowledge on 5-4-1994 the show cause notice was issued on 22-12-1994. Citing the Tribunal judgment in the case of J.S.L. Industries Ltd. v. C.C.E. - 1999 (109) E.L.T. 319 (T) = 1998 (25) RLT 779, the claim was made that the proceedings were hit by limitation. It was also argued before the Commissioner that M/s. Veejay Corporation was a unit in existence, that they had intimated their existence by way of requisite declarations under the Central Excise Rules. It was further claimed that the very fact that M/s. Jalla Indu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lone the determination that M/s. Jalla Industries were exercising the financial control over M/s. Veejay Corporation. The paucity of evidence against the assessees is made worse by the lack of discussion in the orders of both the lower authorities. 4. On limitation we find that the assessees have made an extremely strong case. In the cited judgment the Tribunal had made a review of the previous judgments on similar facts. In these judgments it had been held that where the department had knowledge and even then the department delayed the issue of the show cause notice, the provisions relating to extended period could not be invoked. The structure of Section 11A of the Central Excise Act is such that it is mandatory upon the department to i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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