9911796707
TMI Blog2023 (10) TMI 7X X X X Extracts X X X X X X X X Extracts X X X X ..... hundred and eleven only) was made alleging that the goods sold through Surya Rubbers & Chemicals Pvt. Ltd. (SRCL) and Pyramid Rubber Company Pvt. Ltd. (PRCL) are not accounted in the books of RRPL. The adjudicating authority vide order dated 30.03.2007 confirmed the demand of duty with interest and imposed penalty on the appellants. The adjudicating authority also ordered confiscation of 102 rolls of PCTR and 182 boxes of BG and allowed to redeem the same on redemption fine of Rs. 1,00,000/- (Rupees One Lakh only). Aggrieved by the said order, appeals were filed before the Commissioner (Appeals) and vide the impugned order, the appeals were dismissed. Aggrieved by the said order of the First Appellate Authority, present appeals were filed. 2. The learned counsel appearing on behalf of the appellant submitted that the allegations in the show-cause notice are prima facie not sustainable since the show-cause notice proposes the demand of excise duty being the duty on the goods cleared by adopting lesser value for effecting clearance through related persons during the period from 2001-04, whereas on the other hand the authorities alleged that the firm SRCL & PRCL are non-existing uni ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se." 3. In addition to the above, the Learned counsel draws our attention to the finding in the Order-in- Original, where adjudication authority framed the issues to decide as; (a) Whether the value of goods manufactured by M/s. RRPL and cleared to M/s. SRC & PRC is correct transaction value in the back drop of investigation conducted and offences registered against the assessee? (b) Whether there was clandestine removal of goods without payment of duty? (c) Whether 102 Rolls of PCTR & 182 Boxes of BG totally valued at Rs. 3,25,762/- which were unaccounted and lying seized from the factory premises of the assessee are liable for confiscation? 4. The Learned counsel draws our attention to documents relied in the show-cause notice and submitted that to allege undervaluation, the document purportedly dated 10.08.2003 was relied in the show-cause notice to adopt the market value of rubber @ 49 per kg. The above said documents cannot be considered as admissible evidence since it is neither signed nor source of the said document is disclosed in the show-cause notice. The Learned counsel also draws our attention to correspondence made by assessee with Rubber Board, where clarific ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sfied, the adjudicating authority should determine the value based upon the transaction value. But (i) in cases where there is no sale and (ii) in cases where there is a sale but the three conditions stipulated in clause (a) are not satisfied, then the adjudicating authority should fall back upon the Central Excise Valuation (Determination of Price of Excisable Goods) Rules, 2000." 4.1 He further submitted that Hon'ble Supreme Court in the said decision held as under: 97. But the Adjudicating Authorities as well as CESTAT are also guilty of failure to do something in these batches of cases. They are: (i) Failure to find out, in cases covered by Section 4(1) as it stood prior to 1-7-2000, whether there were sales in the course of wholesale trade, satisfying the 3 conditions prescribed therein, falling under clause (a) of sub-section (1) or whether the sales in question fell under clause (b) of sub-section (1) of Section 4; (ii) Failure to find out, in cases covered by Section 4(1) as it stands amended by Act 10 of 2000 with effect from 1-7-2000, whether the sales in question fell under clause (a) or clause (b) of sub-section (1) of Section 4; (iii) Failure to find out, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot be linked to delivery at the time and place of removal or where the price is not the sole consideration for the sale, even though the price charged in the course of wholesale trade for delivery at the time and place of removal are available. (IV) If the case falls under Section 4(1)(b) and the Adjudicating Authority takes recourse to the method of valuation prescribed in the 1975 Rules, he shall find out which among the relevant rules would apply to the cases on hand before proceeding with the valuation. (B) Cases where the period of assessment is after 1-7-2000 (I) First ascertain the "transaction value", with particular reference to the definition of the said expression contained in Section 4(3)(d). (II) Apply the transaction value so ascertained, to cases where three conditions, namely (i) the goods are sold for delivery at the time and place of removal, (ii) the assessee and buyer are not related and (iii) the price is the sole consideration, are satisfied. This is because such cases will fall under Section 4(1)(a). (III) In cases where one or more of the aforesaid three conditions are not satisfied, and also in cases where there is no sale, the Adjudicating A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncy while issuing show-cause notice and adjudicating authority to adopt value of rubber as Rs.49 to allege undervaluation, the Learned AR could not substantiate the evidentiary value of said document. The learned AR draws our attention to the statement recorded from Sri B.S Siddalinga Swamy and MD of RRPL. In his statement dated 05.04.2005 Sri. B.S Siddalinga Swamy stated that main intention of creating SRC and PRC was to procure orders from KSRTC, when in reality only RRPL had the manufacturing facility. 6.1. Learned AR also submitted that the PRC had made payment of more than Rupees one crore to various raw-material suppliers from the account of PRC and more than Rs.1.74 crore from the account of SRC to various raw-material suppliers, an amount of Rs. 25,81,000/- is paid to PRC when there is no billing between the two companies. The learned AR also draws our attention to the documents produced by the appellants regarding reference to the Inspection Committee, wherein it is stated that during the course of inspection of the firms located in different places of Karnataka, it was observed that most of the tenderers have been quoting under 2 or 3 firms though they do not possess the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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