TMI Blog2018 (3) TMI 620X X X X Extracts X X X X X X X X Extracts X X X X ..... eri Club Soda - Held that: - the ratio of the Hon’ble Apex Court judgment s in Sri Ganganagar Bottling Co. Ltd. [2007 (8) TMI 23 - SUPREME COURT OF INDIA], is very much applicable to the present case since the facts are pari materia. In the facts of Sri Ganganagar Bottling case the brand name owners were themselves not manufacturing CITRA aerated water and therefore was alleged that the franchisee who was in fact manufacturing the same would not be eligible for SSI exemption - demand not sustained. SSI exemption - LFFL, brand owners of CITRA - Held that: - when PBPL was not within the knowledge of the fact whether LFFL had crossed the aggregate value of clearances prescribed for SSI benefit and further, when the belief that the former had not, was strengthened by way of certificates issued by the Range Superintendents, even as on 12.4.1993, the benefit of SSI exemption cannot be denied to PBPL not only for the impugned period covered by N/N. 175/86-CE but also that covered by N/N. 1/93-CE - demand set aside. Appeal allowed - decided in favor of appellant. - E/742-743/2010, E/9, 10, 11, 12/2011 - Final Order Nos. 40566-40571 / 2018 - Dated:- 28-2-2018 - Ms. Sulekha Beevi C. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Normal effective rate of duty ₹ 5,31,582/- O.C. No. 621/94 dt. 26.2.94 issued by Superintendent, Nager Coil Range 1.11.1993 to 11.11.1993 Simultaneous availment of MODVAT facility and SSI exemption Citra Normal effective rate of duty ₹ 67,931/- 2. These show cause notices were adjudicated under a common order dated 26.3.2009. In adjudication, the adjudicating authority found that no action is warranted in respect of three show cause notices; however, confirmed the proposal in respect of two show cause notices dated 28.2.1994 (inter alia for demand of duty of ₹ 9,61,561/- and vide dated 24.9.1994 inter alia for demand of duty of ₹ 49,75,204/-). The original authority demanded duties and imposed penalties as under:- Name of the Appellant OIO No. Date Period Involved Duty Amount Involved (In Rs.) Penalties Imposed (In Rs.) M/s. Prabha Beverages Pvt. Ltd. 05 to 09/JC/CE/2009 dated 26.3.2009of JC, T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... th the RG-1 register and no rationale method was adopted to corroborate the charge of clandestine removal. There is no evidence at all with regarding purchase of excess crown corks, concentrates, bottles etc. The issue involved is covered by the decision of the Hon ble Tribunal in the case of Commissioner of Central Excise Vs. Moon Beverages reported in 2002 (150) ELT 976; Commissioner of Central Excise Vs. Annapurna Industries Ltd. reported in 2003 (153) ELT 586 and Madura Coats Pvt. Ltd. Vs. Commissioner of Central Excise reported in 2009 (245) ELT 403. 5.5 With regard to demand of ₹ 11,44,571/-, that has been made on the ground that the owners of Bisleri Club Soda do not manufacture club soda and hence PBPL themselves are not eligible for SSI exemption. Ld. Advocates submit that there is no legal requirement that the brand owner must actually manufacture the goods. What is relevant for consideration is whether Aqua Minerals Pvt. Ltd. were eligible for the grant of exemption. The issue involved is covered by the decision of the Hon ble Supreme Court in the case of Commissioner of Central Excise, Jaipur Vs. Sri Ganganagar Bottling Co. reported in 2007 (215) ELT 481 (SC). ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ine removal was sought to be established on the basis of one single factor namely that of the SMR. Whereas in the present case, the SMRs were further used for formulating marketing programme and expenditure on advertising at national / regional level through soft drinks advertising and Marketing Services Pvt. Ltd. 6.3 In respect of dispute concerning Bisleri Club Soda, the ld. AR takes us to page 9 of the impugned order, wherein the Commissioner (Appeals) has found that PEL were the proprietors of Bisleri Club Soda and this brand name does not appear to have been given under the written consent to the Bisleri Club Soda to their franchise units. Hence the Bisleri Club Soda manufactured by various franchisees of PEL including PBPL are also not eligible for exemption. 6.4 In respect of demand of ₹ 38,30,633/-, ld. AR submits that LFFL brand owned by CITRA are not eligible for SSI exemption as they had exceeded statutory limits of aggregate value of clearances specified in Notification No. 175/86 and No.1/93. This being so, PBPL are themselves ineligible for availing exemption of goods bearing the said brand name. 7. Heard both sides and gone through the case records. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d used by them for various purposes such as brand strategy, marketing research etc. In this connection, the statements of various officers of M/s. PEL were recorded and they confirmed the correctness and authenticity of the sales figures reflected in the computer print out. These sales figures were found to be much higher than the sales figures recorded in the RGI register maintained by the assessees. Besides this, the Central Excise officers also found that the assessees have not accounted for the entire quantity of NABB received from M/s. PEL/Parle International Ltd. xxxx xxxx xxxx xxxx xxxxx 6. Shri C.G. Hegde, Franchise Development Manager of PIL has stated that they were receiving Sales Manager Report from Franchise bottlers in form SRM-I to SMR-6 every month, based on which the franchise wise sales reports were fed into the computers and the sales was analysed and also sent to the Advertising agencies for working out the bottlers to the advertising pool. He was also shown a letter dated 12-7-1991 wherein Shri G.P. Selvam had reported to him, test results of Limca by Shriram Institute of Industrial Research indicating that MBL was diluting Limca. Shri Selvam confirme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... use of one particular material. Other raw materials required are crown corks, sugar, and carbon dioxide. The Department has not been able to establish that the assessees have surreptitiously procured such raw materials for use in the manufacture of aerated waters. This, coupled with the fact that the assessees have further explained for the difference in quantity of concentrates purchased and quantity accounted for, renders the duty demand on account of suppression of production, unsustainable. 8.2 In the circumstances, we find that the Moon Beverages s decision will on all fours apply to the facts of the present dispute and since that decision has attained finality, the ratio thereof will necessarily have to be applied to facts of the present case also. Hence that portion of the impugned order on this issue confirming the demand of ₹ 9,61,561/- will not sustain and will have to be set aside. So ordered. 8.3 The 2nd issue concerns an allegation that PBPL are not eligible for SSI exemption in respect of production of clearances of Bisleri Club Soda, since the owners of that brand Aqua Minerals Pvt. Ltd. do not themselves manufacture the goods. The ld. counsel has submi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .5 The last issue of contention involves the duty demand of ₹ 38,30,633/- on the ground that LFFL, brand owners of CITRA are not eligible for SSI exemption as they have exceeded statutory limits of aggregate value of clearances. In the statement of facts annexed to the show cause notice dated 24.9.1994, it has been alleged that PEL and LFFL are controlled by the same management headed by Shri R. Chauhan. The notice has given the clearance value of all excisable goods by these three factories in page 24 of the notice and has alleged that since the statutory limits of aggregate value of clearances specified in Notification No.175/86 having been exceeded, the branded goods LFFL manufactured by PBPL as a franchisee will also not be eligible for SSI exemption. The period of dispute indicated in the show cause notice is from 1.9.1991 to 11.11.1993, covering the periods when SSI Notifications No.175/86 dated 1.3.1986 and 1/93 dated 28.12.1993 were in force. In response to these allegations which have been upheld by the lower authorities, ld. Advocates have contended that PBPL had claimed SSI exemption only on the basis of certificates issued by the Superintendent having jurisdiction ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... amesh J. Chauhan or Prakash J. Chauhan or persons related to him or being members of the Board of Directors of various companies had right to create facet to avail the benefits under the Notification in question. Since these concerns could not have availed the benefits they have created dummy concerns to avail the benefits. It is submitted that in the circumstances there was necessity to lift the corporate veil to find out the true owners. 8. Per contra, learned counsel for the respondents submitted that there is no material that the respondents had ever been parties to the so called arrangement, even if it is accepted for the sake of arguments but not conceded, that such arrangement was in reality made. There was no material brought on record to show that the respondents had any role to play in such matters as alleged. Even the show cause notice did not refer to any particular material to come to such a conclusion. Therefore, the Commissioner and the CEGAT were justified in holding that the respondents were entitled to the benefits. 9. We find that in the show cause notice there was nothing specific as to the role of the respondents, if any. The arrangements as alleged h ..... X X X X Extracts X X X X X X X X Extracts X X X X
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