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G. Nandagopal Versus Commissioner of Central Excise, Service Tax and Customs Visakhapatnam-II

2015 (11) TMI 697 - CESTAT BANGALORE

Penalty u/r 26 - Under Valuation of goods - Demand of differential duty - Held that:- The original authority did not examine the contract between the railways and the appellant since the appellant had not appeared for personal hearing. The appellate authority relied upon the conclusions of the original authority. It has been the claim of the appellant that the bifurcation of value of materials and labour is only for convenience and not based on actuals. This claim has not been verified with refe .....

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ard the matter. The table in the order-in-original indicates differential value and assessable value. In the column for assessable value it is not written as differential assessable value. Therefore we do not know whether the duty paid by the assessee has been taken into account or not. Moreover for limitation purpose also there is a need to examine whether under these circumstances appellant could have entertained a bona fide belief or not. - Matter remanded back - Decided in favour of assessee .....

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ix Thousand Four Hundred and Seventy One only) being the differential duty on the finished goods cleared during the period from February, 2000 to March, 2004 under Proviso to Section 11A of Central Excise Act, 1944, confirmed interest under Section 11AB, imposed penalty of ₹ 12,26,471/- (Rupees Twelve Lakhs Twenty Six Thousand Four Hundred and Seventy One only) under Section 11AC ibid and imposed personal penalty of ₹ 1,00,000/- (Rupees One Lakh only) under Rule 209A of Central Excis .....

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y the Departmental Officers revealed that both Talupula Industries and Talupula Engineering Company are proprietary concerns owned by Shri Nanda Gopal Gandham, and that M/s. TEC is engaged in the execution of Railway Electrification Works as per the contract awarded by the Indian Railways; Talupula Industries was floated for manufacture of galvanized steel products required for the execution of contracts by TEC; M/s. TEC was receiving orders for supply and erection of various galvanized steel pr .....

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on of goods manufactured and sold to the related firm viz., M/s. TEC which is his own contract executing firm thereby resulting in short payment of Central Excise Duty. 2. In this case TEC is receiving orders for supply and erection of various galvanized steel products and Railways are paying the erection charges separately. It is the stand of the department that the value of galvanized steel products manufactured by Talupula Industries and supplied to the firm owned by the same proprietor has t .....

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is no undervaluation at all. It was admitted that both the units involved are owned by the same proprietor and it was submitted that there cannot be a sale between the two firms owned by the same persons and therefore the concept of related person cannot be invoked for demanding differential duty. It was submitted that since the same person owned both the units, in the absence of any sale of the products except its use in the execution of works contract, the procedure for valuation adopted by .....

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