TMI Blog2010 (9) TMI 497X X X X Extracts X X X X X X X X Extracts X X X X ..... cause notice. - E/3/2008 and E/863/2007 - 1186-1187/2010 - Dated:- 15-9-2010 - Dr. Chittaranjan Satapathy, Shri D.N. Panda, JJ. REPRESENTED BY : Ms. Kusum Rangnath, Advocate, for the Appellant. Ms. Sudha Koka, SDR for the Respondent. [Order]. - In respect of these two appeals, the final order was signed by both the Members of the Bench and sent to the Registry of the South Zonal Bench Bangalore for pronouncement of the order there, with the approval of the Hon ble President. However, the Registry at Bangalore has reported misplacement of the order. Accordingly, a gist of the order approved earlier by both the Members of the Bench is recorded below for pronouncement :- 1. The Appellant M/s. Annapurna Industries in Appeal case No. E/3/2008 came in appeal before Tribunal against a common Appellate order dated 16-9-2007 passed by learned Commissioner (Appeals) disposing two appeals registered before him as Appeal Case No. 32/2007-(H-IV) C.E. and 42/2007 (H-IV). Appeal No. 32/2007 arose out of O-I-O No. 04/2007 dated 14-2-2007 and Appeal No. 42/2007 arose out of O-I-O No. 6/2007, dated 29-3-2007. 2. In Appeal No. 32/2007, before learned Commissioner (Appeals), h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uthority and cleared such goods without payment of duty availing benefit under Notification No. 8/2003 and enjoyed undue advantage. Investigation recovered various records/documents from the factory premises of the Appellant under Panchnama dated 6-10-2005. During search, they found, besides other machinery, moulds of different brands viz., Lalkamal, Ceilo and Rosekamal and mould designs of Lalkamal , National and Ceilo in the factory. They also found stock of Plastic Moulded Chairs, bearing the brand names of Lalkamal (1750 Nos.), Ceilo (502 Nos.), National (225 Nos.), Maharaja Gold (607 Nos.), Rosekamal (7 Nos.) and Taj Mahal Gold (1 No.) , manufactured by the Appellant. 6. Investigation ascertained that the brands used by the Appellant in manufacture of its goods as above belonged to Shri Rahmatullah who was Proprietor of M/s. Rosekamal Moulded Furniture, Bangalore and he was also resident of Flat No. 104, Aga Apartments A Block, Nampally, Hyderabad. That person was also manufacturing plastic moulded chairs with the same brand name at M/s. Lalitha Plastics, Cherlapally, Hyderabad. Investigating team seized the available stock of branded plastic moulded chairs tot ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as they have manufactured and cleared excisable goods i.e. branded plastic moulded chairs without obtaining Central Excise registration; (iii) Rule 10 of Central Excise Rules 2002, inasmuch as they have not maintained a proper account of the total production and clearance of branded plastic moulded chairs and; (iv) Rule 11 of Central Excise Rules, 2002 inasmuch as they have made clearances of branded plastic moulded chairs without the cover of proper Central Excise Invoice. 10. Revenue s interest being prejudiced, the charges levelled above against the Appellant warranted issuance of notice dated 26-5-2006 to show cause by the Appellant as to why : (i) Plastic Moulded Chairs manufactured by it should not be classified under Chapter sub-heading No. 9403.00 up to 28-2-2005 and under 9403 70.00 w.e.f. 1-3-2005 of the Central Excise Tariff Act, 1985; (ii) An amount of Rs. 46,30,026/- towards CENVAT and Rs. 75,722/- towards Education Cess (totalling to Rs. 47,05,798/-) should not be paid by the Appellant under Section 11A(1) of the Central Excise Act, 1944 read with proviso thereto towards the Central Excise duties not paid by it on the clearances of branded plast ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to following consequences :- (1) Plastic Moulded Chairs manufactured and cleared by M/s. Annapurna Industries were classifiable under Chapter sub-heading No. 9403.00 from June 2003 up to 28-2-2005 and under SH 9403 70.00 w.e.f. 1-3-2005 of the Central Excise Tariff Act, 1985; (2) Lalkamal, Ceilo, National, Maharaja Gold, Rosekamal, Taj Mehal gold branded plastic moulded chairs totally valued at Rs. 3,19,200/- (Rupees Three lakhs nineteen thousand two hundred only) were liable to confiscation under Rule 25 of the Central Excise Rules, 2002; However, those were redeemable on payment of redemption fine of Rs. 30,000/- (Rupees Thirty thousand only) in lieu of confiscation under Rule 25(2) of the Central Excise Rules. (3) An amount of Rs. 33,06,722/- (Rupees Thirty three lakhs six thousand seven hundred and twenty two only) was recoverable towards CENVAT and Rs. 49,230/- (Rupees Forty nine thousand two hundred and thirty only) towards education Cess (totalling to Rs. 33,55,952/-) under Section 11A(2) of the Central Excise Act, 1944. (4) An amount of Rs. 10,00,000/- deposited by M/s. Annapurna Industries in the course of investigation was liable to be appropriat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to use mould for manufacture of moulded chairs. The mould owner had never manufactured any goods under the brand name for which the appellant was absolute owner of the brand. Revenue has not discharged its burden of proof on its stand as to the fact that appellant had manufactured goods under a brand name belonging to a third party. Only because mould of a third party was used that does not ipso facto takes away SSI exemption benefit from the appellant. There was no nexus with Sri Rahamatullah. There was no evidence on record to suggest that moulds were leased by him to the appellant. Since no goods were ever manufactured by Sri Rahamatullah, the appellant was not deniable to SSI exemption benefit. Sri Rahamatullah was not the owner of brands. Therefore Board Circular No. 52/52/94-CX., dated 1-9-1994 is interpretable in favour of the appellant. There was no clandestine removal made by the appellant. She further submitted that the adjudication proceeding was time-barred since Show Cause Notice was issued in this case on 26-5-2006 and there was no .suppression of fact at all. There was no liability to duty or penalty at all in view of SSI exemption permissible to the appellant. The a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by learned counsel said to have defined their relationship in respect of use of brand name was mere whisper without any such agreement came to see the light of the day before Tribunal in the course of hearing. Learned counsel failed to provide copy of the same for examination. Nor also filed a copy thereof subsequent to hearing although liberty was granted to do so. Para 51 of the order of adjudication exhibits that there was an oral agreement between the parties for leasing of the mould for manufacture of plastic moulded chairs and such moulds were used by Appellant in manufacture of branded goods on payment of Rs. 2/- per chair to Sri Rahamatullah. Materials borne by record thus became decisive in absence of any agreement produced to the contrary. 18. Materials gathered and evidence recorded from different persons as stated in para 6, 7 8 of the order of Adjudication shows that the appellant had manufactured and cleared plastic moulded chairs exclusively bearing the brands Lalkamal , Rosekaml , Ceilo and National from June 2003 onwards. It had also manufactured PP Mats without any brand during the period. The moulded chairs manufactured with the brand names Lal kama ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icability of SSI exemption notification to it. He found deliberate suppression of fact without seeking central excise registration in terms of para 17 of the appellate order. 21. The Appellant not only cleared the branded chairs and unbranded PP mats under sales bills/invoices during the period from June 2003 to September 2005 but also cleared certain branded chairs without any sales bills/invoices, as exhibited by records recovered from the residence of Shri Rahamatullah. However value of the goods cleared under sales bills/invoices above period was deducted from the total money receipts and the remaining amount was considered by learned Adjudicating Authority as the value of clearances of branded chairs without sales bills/invoices during the period. Such fact remained undisputed all along. 22. Appellant had also procured reprocessed granules without bills to enable it to manufacture goods and clear the same without sales bills/invoices, as proved from records recovered from the residences of Shri Rahamatullah. No rebuttible evidence could be led by the Appellant to prove its claim of no use of brand name nor could it prove that the brand name belonged to it. While nexus of b ..... X X X X Extracts X X X X X X X X Extracts X X X X
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