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TMI Blog2014 (12) TMI 237X X X X Extracts X X X X X X X X Extracts X X X X ..... osition of identical amount of penalty under Section 11AC of the Central Excise Act, 1944. In addition, penalty of Rs. one lakh stand imposed upon the said appellant in terms of Rule 173Q of the erstwhile Central Excise Rules, 1944. Further, penalty of Rs. 2 lakhs stand imposed upon M/s. Dhampur Alco Chem Ltd. 2. After hearing both sides duly represented by Shri Ashok Sagar and Shri A.K. Mishra, learned advocates appearing for the appellant and Ms. Shweta Bector, learned DR appearing for the Revenue, we find that M/s. Dhampur Sugar Mills Ltd. was engaged in the manufacture of various types of chemicals. M/s. Dhampur Alco Chem Ltd. were appointed as a collection agent-cum-consignment agent by the sugar factory under the agreement dated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of imagination be held to be a part of assessable value of the chemicals cleared from their factory. 4. The lower authorities however, did not favour with the above contention of the appellant and confirmed the demand along with confirmation of interest and imposition of penalties. 5. After hearing both sides, we find that Revenue's case is based upon some letters written by M/s. Dhampur Alco Chem Ltd. to their customers indicating that they have a factory at Dhampur. Further reference stand made to the agreement which appoints M/s. Dhampur Alco Chem Ltd. as consignment agent. Reference also stand made to two instances where the freight charges were directly received by the sugar factory. 6. The Revenue's reliance on the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s. Dhampur Alco Chem Ltd. was being transferred to M/s. Dhampur Sugar Mills Ltd. We also note that two appellants are public limited companies and as such, are independent legal entities in the eyes of law. They do not have any common Directors and are operating independently in their own fields. As such, any amount collected in excess by M/s. Dhampur Alco Chem Ltd. in the name of freight cannot be held to be a part of assessable value of the chemicals being manufactured and cleared by M/s. Dhampur Sugar Mills Ltd. 8. In fact we find that as per the legal position clarified by many decisions of higher Courts, even if such excess freight charges are being collected by the manufacturers of the excisable goods themselves, even then the s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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