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TMI Blog2004 (1) TMI 517X X X X Extracts X X X X X X X X Extracts X X X X ..... hennai-II Commissionerate, Chennai - 600 035 wherein, he has confirmed the demand of duty of Rs. 10,85,066/- under proviso to sub-section (1) of Section 11A of the Central Excise Act, 1944 and ordered adjustment of Rs. 3,50,000/- already paid by the assessee against this demand and he has also imposed mandatory penalty of Rs. 10,85,066/- under Section 11AC of the Central Excise Act, 1944. He further ordered recovery of interest in terms of Section 11AB. He has also imposed penalty of Rs. 1,70,000/- on V. Sathyanarayana and Rs. 1,10,000/- on V. Ramesh under Rule 209A of Central Excise Rules, 1944. 2. It is submitted that an amount of Rs. 3,50,000/- paid by the Appellant and confirmed by the Lower Adjudicator, may be treated as Pre-depo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Hon'ble CESTAT, Chennai Bench on this specific aspect. It is held in K.R. Balachandran v. CCE, Coimbatore - 2003 (151) E.L.T. 68 (T) : "Demand - Show Cause Notice - Dummy Units - When the department holds the other unit as a dummy unit or to hold that the said unit is on paper or that there is flow back of funds, then it was mandatory to issue show cause notice to the other units - Violation of issue of show cause notice to the other units vitiated the proceedings - Section 11A of CEA, 1944". 3. In view of the above, I proceed to decide the Main Appeal. The three concerns as mentioned in para 3 of the Order-In-Original are as follows : (i) M/s. Sri Vaasavi Printers, a partn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to be set aside. There are a catena of decisions on this subject matter, some of which are enumerated below : UOI & Others v. Madhu Milan Syntex Pvt. Ltd. - 1988 (35) E.L.T. 349 (S.C.) : In this case, the Hon'ble Supreme Court has held : "Demand raised without notice or hearing invalid - Post Facto Show Cause Notice and hearing does not make it valid, prior notice is a condition precedent under Section 11A of the Central Excises and Salt Act, 1944 - Section 11A of the Central Excises and Salt Act, 1944 clearly proceeds that prior show cause notice must be issued to the person against whom any demand on ground of short levy or non-levy of excise duty is proposed to be made. Therefore, a post facto show cause notice cannot be regarded as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act, 1944." CCE v. Sethia Foods - 2003 (156) E.L.T. 395 (T) : "We find that the SCN was issued only to Sethia Foods Ltd. No SCN was issued to M/s. Sethia Sweet Products for clubbing their clearances with M/s. Sethia Foods. Principles of natural justice requires that assessee should be put on notice regarding their commission or omission for violating the provisions of Central Excise Act or Rules. In the present case, the Revenue wants to club the clearances of M/s. Sethia Sweets Products with M/s. Sethia Foods without issuing any SCN to M/s. Sethia Sweets which is not permissible...... In view of the above discussions, we find no infirmity in the impugned Order. The appeal is rejected." Dawn Fireworks Factory & Ors. v. CCE - 1999 (31) RL ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ibunal (Larger Bench) decision in the case of Alcobex Metals Pvt. Ltd. v. CCE - 1992 (58) E.L.T. 108 (T) is relevant wherein it is held that "Show Cause Notice not sustainable if partly invalid, - Notice without jurisdiction, entire proceedings for other purpose also invalid without jurisdiction." 5. M/s. SVP has contended that the present proceedings initiated under the said Show Cause Notice cannot survive for the reasons already explained in the preceding paras, since no Show Cause Notice was issued to other parties whose clearances are proposed to be included in the clearances of M/s. SVP, that in terms of the ratio of the Hon'ble Tribunal decisions in Alcobex Metals Pvt. Ltd., cited supra, as the Show Cause Notice is already inv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cause notice provided the changes are explained to the party. However, it has come to the notice that in some cases such waiving of show cause notice is creating problems particularly when cases involve offences or high stakes and/or involve legal questions. The CBEC has taken note of the fact that in such cases waiving of the show cause notice and/or not explaining the charges and the ground thereof to the concerned parties leads to defective proceedings against the interest of the revenue. 2. After careful consideration the Board has, therefore, decided that wherever, prima facie, offences of serious nature or high stakes and/or legal questions are involved, show cause notices must not be waived and the same should be issued and ser ..... X X X X Extracts X X X X X X X X Extracts X X X X
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