TMI Blog2011 (5) TMI 720X X X X Extracts X X X X X X X X Extracts X X X X ..... ty can be demanded only for normal limitation period - Interest on short paid/not paid duty under Section 11AB and imposition of penalty under Section 11AC was linked to such short payment/non-payment being due to fraud, wilful suppression of facts, mis-statement etc. with intent to evade payment of duty - these elements are not present in this case - interest on duty under Section 11AB and penalty on M/s. Supreme Rubber Industries under Section11AC not imposable - matter is remanded to the original adjudicating authority for re-quantification of duty demand - E/1347 and 1348/02 - Mum - A/437-438/2011-WZB/C-II(EB) - Dated:- 18-5-2011 - Shri Rakesh Kumar, Shri Ashok Jindal, JJ. Appearance Shri Durgesh Nadkarni, Advocate for Appellant Shri A.K. Prabhaker, JDR for Respondents Per :- Rakesh Kumar The facts giving rise to these two appeals are in brief as under. 1.1 M/s. Supreme Rubber Industries is a proprietary firm of Shri Samir Batavia engaged in the manufacture of moulded rubber automobile parts and availing S.S.I. exemption under Notification No. 01/93-CE. M/s. Batavia Brothers is a trad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the show-cause notice was confirmed along with interest and an amount of Rs.20,000/- already paid was appropriated towards the demand and besides this penalties were imposed on M/s. Supreme Rubber Industries, M/s. Batavia Brothers and other co-noticees. While penalty of Rs.1,86,002/- was imposed on M/s. Supreme Rubber Industries under Section 11AC, penalty of Rs.50,000/- was imposed on Batavia Brothers under Rule 209A of Central Excise Rules, 1944. On appeal to Commissioner (Appeals) by M/s. Supreme Rubber Industries, Batavia Brothers and other co-noticees, the Commissioner (Appeals) vide order-in-appeal dated 31.10.2001 upheld the duty demand, but penalty on M/s. Supreme Rubber Industries was reduced to Rs.15,000/- and penalty on Batavia Brothers was reduced to Rs.5,000/-. Penalty on other noticees was also reduced. Against the order of the Commissioner (Appeals) these two appeals have been filed by M/s. Supreme Rubber Industries and M/s. Batavia Brothers. 2. Heard both sides. 3. Shri Durgesh Nadkarni, Advocate, learned Counsel for both the appellants, pleaded that M/s. Supreme Rubber Industries were manufacturing the rubber moulded auto parts on job-work basis out of raw ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Tribunal it is clearly mentioned that there were in conflicting views on this issue that the Hon'ble Supreme Court in case of Mentha Allied Products Ltd. vs. CCE Meerut - 2004 (167) ELT 493 (S.C.) has held that extended period under the proviso to Section 11A of Central Excise Act, 1944, would not be available when different views have been expressed at different stages by different Tribunals and High Courts, that the same view has been taken by the Hon'ble Supreme Court in the case Continental Foundation Jt. Venture vs. CCE Chandigarh - 2007 (216) ELT 177 (S.C.), that in view of this, in any case the duty demand would survive only for normal limitation period and neither penalty under Section 11AC would be attracted, nor interest under Section 11AB would be chargeable as during that period - penalty under Section 11AC and interest on duty under Section 11AB were linked with short levy/short payment of duty being on account of fraud, willful suppression of facts etc., that no penalty is imposable on M/s. Batavia Brothers and that in view of this, the impugned order is not correct. 4. Shri A.K. Prabhakar, learned Departmental Representative, defended the impugned orde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... effect with effect from 01.04.2007 by inserting Rule 10A in the Central Excise (Valuation) Rules, 2000 and this Rule has not been given retrospective effect. Therefore, during the period of dispute, the question of valuation of the goods manufactured on jobwork basis was governed by the Hon'ble Supreme Court judgement in the case of Ujagar Prints etc. (supra). Hence the duty liability on the goods manufactured by M/s. Supreme Rubber Industries is to be discharged on the value determined on the basis of the cost of the raw material plus job charges plus job worker's profit, not on the sale price of the owners of the goods. Since the duty has been demanded on the price at which the owner of the goods sold the same the same requires to be re-quantified. 6. The next point of dispute is as to whether the extended period was available to the department. We find that the show-cause notice has been issued only on the ground that M/s. Supreme Rubber Industries were availing S.S.I exemption Notification even though the goods manufactured by them, they were affixed with the brand name of other persons/traders. Further we find that as has been stated in para 4 of the Judgement of the Larg ..... X X X X Extracts X X X X X X X X Extracts X X X X
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