TMI Blog2007 (11) TMI 146X X X X Extracts X X X X X X X X Extracts X X X X ..... raman, Member (T) [Order per: T.K. Jayaraman, Member (T)]. - 1. These appeals have been filed against the Order-in De novo No. CE-11/2006 (Comm'r) dated 27-11-2006, passed by the Commissioner of Customs Central Excise, Guntur. 2. The main appellant, M/s. Sri Chakra Cements Ltd., manufactures cements. The period of dispute is from April 2001 to October 2001. In the impugned order, the Adjudicating authority has demanded duty amount of Rs. 46,51,762/-. He has imposed equal penalty under Section 11AC and also a penalty of Rs. 20,00,000/- under Rule 173Q of the Central Excise Rules, 1944. A penalty of Rs. 5,00,000/- has been imposed on the Company's Whole time Director. Further a penalty of Rs. 10,00,000/- each has been imposed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... In view of this fact, the Revenue proceeded against the appellants and confirmed the demand on the main appellant. 5. The learned Advocate urged several points. He emphasized the point that the six grinding units are actually independent units. This is an admitted position even in the de novo order as well as the first order passed by the Adjudicating authority. Each grinding unit has its own facilities and independent existence. It has its own registration, Labour, etc.,. The grinding units only purchased clinker from the main appellant, manufactured the cement under the brand name "Charka" and sold the same to the main unit. He said that this is legally permissible and there is nothing wrong in that. He emphasized the point that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ut that even though the appellant is entitled for concessional rate of duty @ Rs. 200 per MT in terms over the of Notification No. 3/2001-C.E., the duty computation is based on the duty of Rs.350/- per MT. He pointed out that this is also a grave mistake in the impugned order. In these circumstances, the learned Advocate urged that there is absolutely no case against the appellants and there is no justification for penalty under Section 11AC and Rule 173Q of the Act. 4. On the other hand, the learned SDR submitted that the six grinding units are actually a clever device for evasion of duty. The appellant supplied clinker and the day to day manufacture of the cement in the grinding units and terms of the operations were supervised by t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cation Nos. 8/2001 and 9/2001. Moreover the appellants themselves are entitled for the benefit of Notification No. 3/2001-C.E. e saddled and they are entitled for the concessional rate of duty @ Rs. 200 per MT. There fore the Revenue has not made a very strong case for clubbing the clearances of the six independent units with the clearances of the main appellant to deny the concessional rate of duty for the relevant period. The demand of duty is not justified. In our view, no violation of the Central Excise Act or Rules has been established. Affixing of brand name 'Chakra' is of no consequence, as the grinding units are located in rural area and this is not in dispute. Therefore the penalties imposed on the Director and the main appellant a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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