2002 (6) TMI 66 - AT - Central Excise

Summary

Issues Involved:
1. Eligibility for SSI Exemption.
2. Validity of the Assignment Deed.
3. Consideration of Modvat Credit.
4. Exclusion of Duty Element in Excisable Value.
5. Time-barred Duty Demand.
6. Imposition of Penalty u/s 11AC.

Summary:

1. Eligibility for SSI Exemption:
The appellants were found using the brand name "ALASKA," which belonged to M/s. Vinko Auto Indus. Ltd., on their manufactured goods. This use disqualified them from availing SSI Exemption u/s Notification No. 1/93. The adjudicating authority confirmed the duty demand of Rs. 16,90,578.19 and imposed an equal amount of penalty u/s 11AC, along with a personal penalty of Rs. 1 lakh u/r 209A.

2. Validity of the Assignment Deed:
The appellants claimed that the brand name "ALASKA" was assigned to them from 1-7-1997. However, the assignment deed was found to be a fake document, lacking essential details such as the date of sale, name of the stamp vendor, and the notary's name. The authorities rightly rejected this deed as it was prepared later to defraud the Excise Department.

3. Consideration of Modvat Credit:
The appellants' plea for Modvat credit on duty-paid inputs was not entertained as it was not raised before the adjudicating authority or the Commissioner (Appeals). There was no evidence to suggest compliance with the formalities required for claiming Modvat credit.

4. Exclusion of Duty Element in Excisable Value:
The appellants argued that the duty element should be excluded from the excisable value, citing the Apex Court's judgment in CCE, Delhi Ltd. v. Maruti Udyog. However, this plea was not raised earlier, and no evidence was provided to support it, making it an afterthought that was ignored.

5. Time-barred Duty Demand:
The appellants contended that the duty demand was time-barred as they had been using the brand name "ALASKA" since 1988, and this was known to the Revenue authorities. However, there was no tangible evidence to prove this claim. The appellants failed to disclose the use of the brand name belonging to another person, leading to the invocation of the extended period of limitation.

6. Imposition of Penalty u/s 11AC:
The penalty u/s 11AC for the period prior to 28-9-1996, when the provisions came into force, was reduced. The duty period involved was from 1-4-1995 to 27-7-1998. The penalty was modified to Rs. 13 lakhs.

Conclusion:
Except for the modification in the penalty u/s 11AC, the impugned order of the Commissioner was upheld. Both appeals were disposed of accordingly.