9911796707
TMI Blog1992 (5) TMI 28X X X X Extracts X X X X X X X X Extracts X X X X ..... Companies Act, 1956 and is engaged in the manufacture of air-conditioners and refrigerators. 3. For the period prior to 1975, the petitioner company had filed price list as required by Rule 173C for the air-conditioners and refrigerators. It was selling its product exclusively through their dealers, namely, M/s. Lloyd Sales Corporation (hereinafter referred to as 'LSC') and M/s. Lloyd Electric and Engineering Company (hereinafter referred to as 'LEECO'). It may be pointed out here that LSC and LEECO are allegedly owned by the same family members who had control over the petitioner company. The Assistant Collector approved the price list vide his orders dated 26th March, 1975 wherein it was held that the assessable value under Section 4(a) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntral Excise, New Delhi in exercise of his power under Section 11 A of the Act issued show cause notice dated 27th March, 1986 to the petitioner company. In this notice, inter alia, it has been alleged that the petitioner company and LSC are related persons in terms of Section 4(4) (c) of the Act and separate legal entities have been created to suppress the real value of their products with the deliberate intention to avoid payment of Central Excise Duty. It was further alleged that the petitioner's so-called ex-factory sales were in fact a strategy to claim lower assessable value since the petitioner company either marketed through LSC who sold the goods at higher price or a part of the sales value was received by LSC or M/s. Air Serco in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Rules. It may be mentioned here that this order is appealable before the Customs, Excise & Gold (Control) Appellate Tribunal (hereinafter referred to as 'CEGAT'). During the course of hearing of the case we were informed by Mr. Sharma, the learned counsel for the petitioner that an appeal against the aforesaid order has already been filed by the petitioner company before CEGAT. 9. Mr. Sharma, the learned counsel for the petitioner urged the following contentions :- (1) That there must be a finding of fact by the Competent Authority that any duty of excise has not been levied or paid or has been short-levied or short-paid by reason of fraud, collusion or any wilful misstatement or suppression of facts u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... look at the records is enough. But a fresh look into the same facts is not permissible. (5) Assuming but not admitting that in any view of the provisions of Section 11A, jurisdictional facts exist in this case for exercising the power under Section 11A(1), the period of limitation of 5 years for exercising this power is not available because the existence of jurisdictional facts have not been brought about by reason of any fraud, collusion or willful mis-statement or suppression of facts or contravention of any provisions of the Act or Rules made thereunder with intent to evade payment of duty by the petitioner. (6) The petitioner and LSC and LEECO cannot be held to be related persons within the meaning of Section 4(4)(c). There is no in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 439 = 1989 (40) E.L.T. 214 (SC). 11. The learned counsel for the respondents further submitted that during the pendency of the writ petition the adjudicating authority has already passed the order dated 21st March, 1989 which was appealable before the CEGAT. In fact the petitioner has also filed an appeal before the CEGAT against the aforesaid order dated 21st March, 1989. In view of this, the only remedy for the petitioner is to pursue the appeal before the CEGAT and the writ petition is liable to be dismissed. 12. Before dealing with the contentions of the parties it may be relevant to refer to Section 11A(1) of the Act which is as follows :- "SECTION 11 A . Recovery of duties not levied or not paid or short-levied or short-paid or err ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f facts, or contravention of any of the provisions of the Act, or the rules made thereunder with intent to evade payment of duty, show cause notice can be issued to the person chargeable with duty and consequently recoveries made. From this it is clear that the intention of the Legislature is to deal with fraudulent evasion of excise duty in the manner provided therein. From the impugned show cause notice it will be seen that the said notice contains clear allegations that the petitioner company and LSC are related persons in terms of Section 4(4)(c) of the Act. There are further allegations that separate legal entity had been created by the petitioner to suppress the real value of their products with deliberate intention to evade payment o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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