TMI Blog2019 (10) TMI 95X X X X Extracts X X X X X X X X Extracts X X X X ..... was filed against all the noticees before this Tribunal; therefore, the issue related to all the noticees were open before the adjudicating authority in de novo adjudication. The appellants have strongly argued that the present adjudicating authority has not considered the findings of fact narrated by the predecessor Commissioner in the first Adjudication Order dated 06.10.1995. In this regard, we find that the first adjudication order was set aside in the Revenue appeal, therefore, the present adjudicating authority is not judicially required to look into the said order as the same was not in existent. Once, the earlier adjudication order was set aside the entire case has gone back to the stage of SCN and thereafter since the entire matter was kept open the present adjudicating authority was free to take independent view on the overall case without getting influenced by the first order and finding of the predecessor Commissioner, therefore, the submission of the Ld. Counsel on this count is fatal and cannot be accepted. The dropping of modvat demand has no impact as far as clandestine removal of goods manufactured and cleared by M/s Jolly Electrical Industries in the guise o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... revity) having Central Excise Registration for manufacture of TV sets, Modular Systems, Plain Paper Copier, paper shedding machine and data display monitors classifiable and chargeable to duty under chapter heading no. 8528.00, 8517.00, 9009.00, 8472.00 and 8471.00 respectively of the Central Excise Tariff Act, 1985. The Central Excise departmental officers carried out massive investigation of all the three units and found that in fact the other two units i.e. Kini and Jolly were not manufacturing the goods whereas the goods manufactured by Jolly Electricals Industries were being cleared under exemption in the name of Kini and Jolly. During investigation various statements of the employees of the appellant and other persons were recorded. The status of the units were also verified and from all these evidences it was revealed that all the clearance shown to have made by Kiny and Jolly are in fact manufactured and cleared from Jolly Electrical Industries. Accordingly, the demand of excise duty was raised against the appellant M.s Jolly Electrical Industries. A SCN dated 02.03.1994 was issued wherein demand of duty, penalty, and confiscation of land and building plant and machinery wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appellants filed these appeals. 2. Sh. P.M. Dave, Ld. Counsel appearing on behalf of the appellant submits that in the first round of adjudication the Collector of Central Excise, Vadodara vide Order dated 06.10.1995 dropped the proceedings against all the noticees holding that all the three firms i.e. M/s Jolly Electrical Industries, M/s Kinitronics and M/s Jolly Enterprises are separate units and both cannot be clubbed. Against the said order dated 06.10.1995, the Revenue filed only one appeal i.e. against M/s Jolly Electrical Industries, therefore, finding with regard to the clubbing of two units i.e. M/s Kinitronics and M/s Jolly Enterprises were held to be independent. The clearance of those units cannot be clubbed with the clearances of the appellant M/s Jolly Electrical Industries, therefore, the demand is not sustainable. He submits that in the impugned order demand of modvat credit against M/s Kinitronics and M/s Jolly Enterprises was dropped though it was proposed in the SCN. He submits that if these two units are treated as dummy units for facade created by M/s Jolly Electrical Industries then modvat credit taken and utilized by these alleged dummies had to be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 334) ELT 427 (Guj.) M/s Vyas Shantilal Jethala Sons Co. Order No. A/10721/2018 dated 03.04.2018 passed by CESTAT, Ahd. 2.2 He further submits that if appeals filed by the Revenue against the alleged dummies were dismissed as time barred (and not on merits) then also clubbing of clearances is not admissible because the situation is that the order dropping the proposal of clubbing for such units has become final. The case of clubbing alleged dummies has become final, the case of clubbing of other clearances with main unit also does not survive. In this support, he placed reliance on the following judgment: CCE vs Supreme Electrical Appliances 2001 (113) ELT 271 (Tri. Del.) CCE Trichirapalli v/s Devi Silicates (P) Ltd. 2004 (178) ELT 1018 (Tri. Chennai) 2.3 He further submits that in remand proceedings also the Commissioner has not called M/s Kinitronics and M/s Jolly Enterprises for hearing, because the case against them was dropped by virtue of order in original dated 06.10.1995 and that order was not challenged by the filing the appeals against these two firms. In case of clubbing of clearances, no order can be passed without join ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at the three units were functioning as one unit and all the manufacturing activities were maintained at premises of Jolly Electrical Industries only. He submits that all the staff were looking after activities of all the three units, therefore, all the three units were working independently. The predecessor Commissioner has recorded in the order dated 06.10.95 that electricity in the factories of M/s Kinitronics and M/s Jolly Enterprises was less because the manufacturing activity over there was only of assembling of imported and otherwise procured parts and components so as to produce goods like electrical switches, fax machines, micro film reader and printer as well as telephone sets, plain paper copier and paper shredders. In view of screw driver technology adopted by these two manufacture electricity consumption in their factory was less. In the impugned order now passed by the Respondent Commissioner, it is held that electricity consumption being of less units in the factories of M/s Kinitronics and M/s Jolly Enterprises and electricity consumption of Jolly Electrical Industries being at higher the manufacturing activities were undertaken only in the factory of Jolly Electrica ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re licensed by the Central Excise Department separately. All the three manufacturers have availed benefit of Modvat Credit by maintaining Modvat Register and filing Modvat declaration. All the three manufacturers have paid duty after exceeding SSI limits. All the units were maintaining RG-1 and filing RT-12 returns, therefore, all the activities of three units were well within knowledge of Revenue Officers. The predecessor Commissioner has recorded in the order dated 06.10.95 that the Central Excise Authorities were aware about these manufacturing activities, therefore, the demand for the extended period of limitation is time barred. 2.9 He further submits that the demand, if any arise, the same needs to be recomputed by extending the benefit of cum duty price as held by the Larger Bench of CEGAT in the case of Shri Chakra Tyres 1999 (108) ELT 361 and in the case of Dugar Tetenal (India) Ltd. 2008 (224) ELT 180 (SC). Accordingly, the demand of ₹ 80,83,376/- was wrongly made and the same atleast deserves to be reduced. 2.10 As regard penalty he submits that since there is no violation of any nature committed by the appellant and they have bonafidely acted. Mo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... estoration of appeal was also dismissed by the Appellate Tribunal. Second application was filed by the present appellant for restoration of Revenue s Appeal was also rejected by the Tribunal. Meanwhile, the adjudicating authority passed a de novo order whereby the duty demand against the present appellants with interest and penalties were confirmed, therefore, the present appeal filed by the appellants. Ld. Counsel vehemently argued on the following points: (i) In the first round the then Ld. Collector dropped the proceedings against all the noticees whereas the Revenue filed appeal only against Jolly Electrical Industries. Accordingly, the finding in the first order that M/s Kinitronics and M/s Jolly Enterprises are not dummy units attained finality if that be so, then the clearances of all the three units cannot be clubbed. (ii) Though in the SCN there was proposal to demand Modvat Credit from M/s Kinitronics and M/s Jolly Enterprises but the same was dropped in the impugned order, therefore, the allegation of these two units being dummy does not sustain. (iii) For clubbing of clearances of all alleged dummy units, against all the units, appeal should h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... all the noticees, therefore, this shows that the appeal filed by the Revenue is not only against M/s Jolly Electrical Industries but also against other noticees in the SCN. 8. The adjudicating authority has observed and recorded in the order that as per the letter F. No. V(Misc.)2-494/96/RC dated 11.11.1996 memorandum of appeal and appeal paper book was forwarded to the Assistant Registrar CESTAT- Bombay and a copy of the same was also forwarded to all 8 noticees to whom the SCN was issued. We find that even if one appeal was filed making number of parties as respondent in the Revenue s appeal itself the appeal deemed to have been filed against all the respondents. 9. It is also observed from the remand order of this Tribunal bearing No. A/622/WZB/2004/C-III dated 08.07.2004 that the following order was passed. When the matter was called, no one appeared for the Respondents. Heard the Departmental Representative and nothing that the issue in this appeal filed by the Revenue involved the clubbing of clearances of two units with that of the clearances effected from the Respondents unit and finding that some of the partners are common, the appeal filed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he findings of fact narrated by the predecessor Commissioner in the first Adjudication Order dated 06.10.1995. In this regard, we find that the first adjudication order was set aside in the Revenue appeal, therefore, the present adjudicating authority is not judicially required to look into the said order as the same was not in existent. Once, the earlier adjudication order was set aside the entire case has gone back to the stage of SCN and thereafter since the entire matter was kept open the present adjudicating authority was free to take independent view on the overall case without getting influenced by the first order and finding of the predecessor Commissioner, therefore, the submission of the Ld. Counsel on this count is fatal and cannot be accepted. 11. As regard, the submission made by the Ld. Counsel that all the three units are independent and registered with various authorities, filing of returns with various tax authorities does not help their case for the reason that in the present case the case of the department is not on the basis of that all the three units are independently manufacturing and clearing the goods and due to mutual interest, inter unit fund flo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... emand has no impact as far as clandestine removal of goods manufactured and cleared by M/s Jolly Electrical Industries in the guise of manufacture and clearances of M/s Kinitronics and M/s Jolly Enterprises, therefore, merely because the case proceedings of modvat credit has been dropped against M/s Kinitronics and M/s Jolly Enterprises it will not affect the case of clandestine removal against M/s Jolly Electrical Industries, therefore, this argument is of no help to the appellant. 12. As regard the heavy reliance made by Ld. Counsel on the Trade Notice No. 59/1992, we find that we have already given our above finding that all the clearances are of M/s Jolly Electrical Industries, therefore, the Trade Notice which deals with the admitted clearances of more than one unit, is not relevant in the facts of the present case. 13. Ld. Counsel also argued vehemently on the point of time bar. As we observed above that M/s Jolly Electrical Industries were indulged into clandestine removal of excisable goods to intention to evade duty in the guise of manufacture and clearance of goods from M/s Kinitronics and M/s Jolly Enterprises, there is a clear fraud, suppression of fac ..... X X X X Extracts X X X X X X X X Extracts X X X X
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