TMI Blog2017 (6) TMI 670X X X X Extracts X X X X X X X X Extracts X X X X ..... consequence, they cannot then be a beneficiary of SSI exemption N/N. 8/2001-CE. In respect of the Ozone Water Purifier as also the magnetic kits, since manufactured bearing the trade name of others, will fall foul of para-4 of the SSI exemption N/N. 8/2001-CE, consequently they cannot avail of the duty exemptions extended in the said Notification. Classification of Magnetic kits - classified under 90.19 or otherwise? - Held that: - these Magnetic kits having been cleared with the brand name/trade name of others, will find themselves bereft of SSI duty exemption under Notification No. 8/2001-CE, they will nonetheless to be eligible for clearances under the effective rates thereof, which, is Nil and 4% for the period under dispute - differential duty liability on the impugned goods namely Magnetic kits will have to be calculated on the basis of effective duty rates as applicable to the goods under chapter heading 90.19 of CETA, viz., Nil upto 01.03.2002 and 4% after 01.03.2002 - matter remanded for denovo adjudication to the adjudicating authority to recalculate duty liability only in respect of this item. Penalty u/s 11AC - Held that: - penalty under Section 11 AC ibid wil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erential central excise duty for the period 2002-03 amounting to ₹ 12,33,461/- under the proviso to Section 11 A (1) of the Central Excise Act, 1944, along with interest under Section 11 AB ibid and imposition of equal penalty under Section 11 AC ibid on M/s. Water Co.; as also a penalty under Rule 26 of the Central Excise Rules 2002 on Smt. Raji Radhakrishnan, Proprietrix of M/s. Water Co. 3. On Similar grounds and allegations, another demand of differential central excise duty for the period 2002-03 amounting to ₹ 60,17,219/- under the proviso to Section 11 A (1) of the Central Excise Act, 1944, along with interest under Section 11 AB ibid and imposition of equal penalty under Section 11 AC ibid on M/s. Velu Traders (Appellant in E/477/2007). In adjudication, the Commissioner vide impugned orders No.11/2007 dated 30.03.2007 and No.07/2007 dated 29.03.2007 confirmed the proposals made in the SCNs and also imposed penalty equal to duty liability on both these appellants. Aggrieved, the appellants are before this forum. 4. Today when the matter came up for hearing, on behalf of the appellants, Ld. Advocate, Shri Derrick Sam, takes us to para-40 of the impugned ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... particular time, there is no way the departmental officers and intercept the goods at the stage immediately after the clearances. They would necessarily have to go by the available evidence within the factory and also lent support the same with statements of the persons concerned. This is certainly been done. The huge quantity of top and bottom covers of Ozone water purifiers embossed with the name of VCNPL definitely serves to prove that the appellants were using them for clearances of the goods to VCNPL. We cannot fathom any other reason for these covers to be present in the appellants factory. 7.3. It is further found that corroborating statements not only were obtained from the concerned persons of the appellant company but also taken from the Director and Finance Manager of VCNPL. All these statements confirmed the modus operandi followed in the entire exercise and there is no discrepancy in the facts admitted therein. 7.4. Notification No. 8/2001-CE, as existed during the relevant period, provided exemption from duties of excise for SSI units, subject to certain eligibility requirements and other conditionalities. Para-4 of the said Notification categorically denies the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e issued to all the appellants proposing to deny SSI exemption and demanding differential duty besides imposition of penalties. After due process of law, the adjudication Commissioner inter-alia confirmed demand of differential central excise duty for the period 2001-02 and 2002-03, on both magnetic kits and ozone water purifiers amounting to ₹ 68,88,192/- under the proviso to Section 11 A (1) of the Central Excise Act, 1944 along with interest under Section 11 AB ibid and imposition of equal penalty under Section 11 AC ibid on M/s. Business Development Corporation; similarly confirmed demand of differential central excise duty for the period 2001- 02 and 2002-03, amounting to ₹ 97,52,772/- under the proviso to Section 11 A (1) of the Central Excise Act, 1944, along with interest under Section 11 AB ibid and imposition of equal penalty under Section 11 AC ibid on M/s. Velu Co.; also imposed personal penalty of ₹ 5,00,000/- on Shri R. Radhakrishnan, Partner of M/s. Business Development Corporation. Hence, these appeals. 11. On behalf of the appellants ld. Counsel Shri Derrick Sam, Advocate, has reiterated the arguments made by him in respect of appeals E/472/2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing the same discussions to the present appeals, we are of the considered view that the evidence findings and conclusion in the above case will apply to these appeals also. Hence, in respect of the Ozone Water Purifier as also the magnetic kits, since manufactured bearing the trade name of others, will fall foul of para-4 of the SSI exemption Notification No. 8/2001-CE, consequently they cannot avail of the duty exemptions extended in the said Notification. 14.2. The only issue left to be addressed in these appeals is related to the classification of Magnetic kits. Lld. Counsel has referred to Boards Circular dated 29.05.2003 to contend that the product has to be classified under 90.19 and that it is not to have any prospective effect; that therefore, for the impugned period, the said goods can fall only under 90.19 and applicable rate of duty would be nil for the period prior to 01.03.2001 and 4% after 01.03.2001. 14.3. Ld. AR has contended that the circular relied upon by the appellant relates to import of Magnetic kits for classification of such goods when imported; hence any benefit flowing out of that circular cannot apply to identical goods manufactured in India. 14. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... /2007 and E/476/2007 will required to be remanded for denovo adjudication to the adjudicating authority to recalculate duty liability only in respect of this item. Ordered accordingly. 14.9. Now we take up the pleas on the matter of penalty. 14.10. Ld. Advocate points out that duty liabilities involved in respect of these appeals are as follows:- S. No. Period Product Duty involved 1. 10/12/2001 to 22/02/2002 Ozone Water Purifier ₹ 7,47,552 2. 01/12/2001 to 27.03.2002 Magnetic kit Rs.27,17,440 3. 30.04.2002 to 30.11.2002 Magnetic kit Rs.34,23,200 Rs.61,40,640 14.11. We do not find any reason for interfering with imposition of penalty under Section 11 AC ibid, equal to differential duty liability determined in respect of Ozone Water Purifier cleared by the appell ..... X X X X Extracts X X X X X X X X Extracts X X X X
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