TMI Blog2002 (3) TMI 88X X X X Extracts X X X X X X X X Extracts X X X X ..... ted against a portion of the order of the Commissioner (Appeals) where he has reduced the quantum of penalty from what had been imposed by the original authority. 2. The brief facts are as follows : Officers of Anti-Evasion branch of the Delhi Commissionerate visited the factory of the assessee on 1-11-99. On scrutiny of the invoices in respect of the contract sale, it was revealed that the assessee was deducting expenses on account of freight and insurance from the assessable value for payment of central excise duty. The declaration filed by the party shows their place of removal as factory gate. Taking the view that, in fact, the place of removal is place of destination, show cause notice was issued calling upon the assessee to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to ensure safe delivery of the goods and the assessee acts as a custodian till the goods reach the buyer's place. The assessee also contended that there are no circumstances available in the case which would justify application of the extended period of limitation. 3. The original authority did not accept the contentions raised by the assessee. The original authority took the view that since the assessee has declared in his declaration, filed under Rule 173C(3A), that their sales are at factory gate whereas the goods were actually being sold at the place of destination, there is no merit in the contention that the assessee had not suppressed any material fact. It was therefore held that the proviso to Section 11A has been correctly ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uyer to the assessee. Since the demand of duty has been confirmed jointly under Rule 9(2) of the Central Excise Rules and Section 11A of the Central Excise Act, 1944, there is no merit in the complaint of the appellant that the demand is unsustainable since Rule 9(2) had been deleted vide Notification No. 38/2000-C.E. (N.T.) dated 13-5-2000. On the question of invocation of the extended period of 5 years the appellate authority also found that it was justified on the facts of the case. The Commissioner (Appeals) upheld the confirmation of demand of duty but reduced the amount of penalty to Rs. 4,00,000 lakhs. 5. It is contended on behalf of the appellant that the Commissioner (Appeals) as well as the adjudicating authority had wrong ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a Factory Ltd. to the destination of the buyers through the transport agency. The goods were stored on their behalf in the godown of the transport agency at the destination of the buyers. The goods were insured in the name and on the account of M/s. Prabhat Zarda for covering the risk of loss/damage during transportation of the goods, to the godowns of the transport agency at the destination of the buyers. Prabhat Zarda was both consignor and consignee. Therefore, during the transport the ownership of the goods remained with them. The goods were delivered to the buyers by the transport agency only when so instructed by M/s. Prabhat Zarda. Till then no legal title in the goods was passed on to the buyer. Therefore it was held that the goods ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arately shown. It is submitted that even though for the sake of convenience booking was done by the appellant and the freight was also paid by it, it was being recovered separately from the buyer. It is not a case where the manufacturer is the consignee as in the case of Prabhat Zarda. Here the buyer is the consignee. Even in the Railway Receipt the buyer's name and address are shown as that of the consignee. We find that the facts in this case are entirely different from those available in Prabhat Zarda and Escorts JCB. 9. In our Final order in Appeal Nos. E/1124, 2001-A (M/s. Associated Strips Ltd.) and E/1565-68/2001-A (M/s. Mauria Udyog Ltd.) wherein the facts are similar to those obtained in this appeal, we have considered in d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... property cannot be applied here. As envisaged in Section 26 of the Sale of Goods Act in terms of the agreement between the parties the seller can retain a risk which would entitle him to have an insurable interest in the goods even when property in the goods are passed on to the buyer. We have arrived at this conclusion after referring in detail to authoritative text books and decisions. We do not propose to refer to all those materials in this order to avoid repetition. 11. The purchase order would show that the goods are to be despatched by goods/passenger train at firm's risk. The above condition by itself would not establish that the ownership of the goods continued with the appellant. In the light of the terms of contract betwe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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