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TMI Blog2007 (5) TMI 80X X X X Extracts X X X X X X X X Extracts X X X X ..... different parts and given on rent to the appellants. After recording the statements of various persons, the authorities issued show cause notice to all the appellants directing them to show cause as to why BPL should not be considered as related person, and that the price at which final product was sold by BPL should not be considered as the correct assessable value and differential duty be not demanded from all 4 appellants. The appellants resisted the show cause notice on the ground that they are not related to BPL and the price at which they are selling their product to were not depressed due to any relation and also that they sold the same product to independent buyers and price is the same as charged to BPL. The adjudicating authority did not accept the contention of the appellant, and confirmed the differential duty amount on the ground that the 4 appellants were related to BPL, and there was financial accommodation between BPL and the 4 appellants which resulted them being related to each other. Hence, these appeals by the appellants. 3. Learned Counsel appearing on behalf of the 4 appellants takes us through the entire show cause notice, statements, and the order-in-origi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he appellant had clearly indicated in the replies to the show cause notice and as well as before us that the appellants being private limited companies their shares are not held by BPL and vice versa. We find that the appellants had given satisfactory reply to the authority on financial accommodation. The said reply clearly indicates that the appellants had explained that the amounts paid by M/s. BPL is towards the consideration of sale, was not contradicted by adjudicating authority in Order-in-Original. Be that as it may be, we find that the three Judge Bench of the Hon'ble Supreme Court in the case of Alembic Glass Industries Ltd. (supra) has held as under:- "4.. It was submitted by learned Counsel for the assessee that the assessee was a public limited company as was the chemical co and two public limited companies could not be said to be 'related persons', unless one was the holding or the subsidiary company of the other, which was not the case here. The fact that the assessee held shares of the chemical company and that the chemical company held shares of the assessee and that they had common Directors could not lead to the conclusion that the assessee and the chemical ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... age of the judgment, learned Counsel for the Revenue draws our attention to the judgment, of a Bench of two learned Judges of this Court, in Calcutta Chromotype Limited v. Collector of Central Excise, Calcutta (99 E.L.T. 202). It does not appear to us that the judgment carries the case of the Revenue any further, nor does learned Counsel so suggest. He says that he has referred to it because of this sentence therein: "The principle that a company under the Companies Act, 1956 is a separate entity and, therefore where the manufacturer and the buyer are two separate companies, they cannot, than (sic) anything more, be 'related persons' within the meaning of clause (c) of sub-section (4) of Section 4 of the Act is not the universal application." We have difficulty, for the reasons already stated, in accepting as correct this sentence. It appears to have been so stated in relation to and in the context of facts of that case. Therefore, the learned Judges, it should be added, remanded the matter for further inquiry into the facts." From the above reproduced portion of the judgment of the Hon'ble Supreme Court it can be noticed that shareholders or the directors of the two public limite ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... respondent no. 3 is without any force in the light of Supreme Court decision in the case of Union of India & Others v. Atic Industries Ltd., reported in 1984 (17) E.L.T. 323 (S.C.), wherein it has been held "it is not enough that the assessee has an interest, direct or indirect, in the business of the person alleged to be a related person nor is it enough that the person alleged to be a related person has an interest, direct or indirect, in the business of the assessee. It is essential to attract the applicability of the first part of the definition that the assessee and the person alleged to be the related person must have interest, direct or indirect, in the business of each other. Each of them must have, direct or indirect interest in the business of other." The same view has been reiterated in the decision of the Apex Court in Alembic Glass Industries Ltd. v. Collector of Central Excise and Customs, reported in 2002 (143) E.L.T. 244 (S.C.). The decision of the Tribunal in the case of L.M.J.S. Tool Room v. CCE, Rajkot reported in 2002 (139) E.L.T. 199 (T), relied upon by the learned SDR, is distinguishable as in that case the entire production of the manufacturer was sold to th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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