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TMI Blog1999 (3) TMI 213X X X X Extracts X X X X X X X X Extracts X X X X ..... led the benefit of Small Scale Exemption Notification. Enquiry made by the Central Excise Officers revealed that the Appellants had sold their entire products through their related persons, namely M/s. Kharbanda Drug Corporation and M/s. Poonam & Co. Shri Sanjeev Kharbanda and Mrs. Kamla Kumari, Partners of M/s. Kharbanda Drug Corporation were son and wife respectively of Shri S.S. Kharbanda Managing Director of the Appellants; that Shri Raju Kharbanda and Mrs. Nidhi Kharbanda, partners of M/s. Poonam & Co. were son and daughter in law respectively of S.S. Kharbanda. In addition both these units utilised the business premises of the Appellants for which hardly any rent was paid by them. They also utilised the telephone and telegraph code of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the price list was approved on 22-11-1988. The Department's appeal against the said approval was pending before the Collector (Appeals). He, further, submitted that under law a private limited company cannot be related person unless it is a holding or subsidiary company which is not in the present matter; that there is no evidence also of any flow back of money or mutual interest. He relied on the decision in the case of Agro Food Punjab Ltd. v. C.C.E. Chandigarh 1992 (60) E.L.T. 574 (Tribunal) = 1992 (40) ECR 452 (Tribunal) in which the Tribunal held that : "The long period of agreement, exclusiveness in marketing of the products in favour of the said M/s. Voltas Ltd. affixation of the brand name of the Customers of Voltas on the pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n of facts or mis-statement by them as all the documents and facts were known to the Department in view of the enquiries made by the Officers, statements submitted by the Appellants and the Department was aware of the sale pattern of the Appellants since 1985. He relied upon the following case laws :- (i) C.C.E. v.Chemphar Drugs & Liniments - 1989 (40) E.L.T. 276 (S.C.) (ii) Neksha Pharmaceuticals v. C.C.E. - 1985 (22) E.L.T. 561 (Tribunal) (iii) Kiran Spinning Mills v. C.C.E. - 1989 (40) E.L.T. 385 5. Countering the arguments Shri K. Srivastava, Ld. S.D.R. submitted that both M/s. K.D.C. and M/s. Poonam & Co. were consisting of Partners who were close relatives of the Managing Director of the Appellant Company; that neither any re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ura Electricals (P). Ltd. v. C.C.E. - 1987 (31) E.L.T. 61 (Mad.) in which it was held that agreement entered between the petitioner and the company is not decisive on the point as to whether the price stipulated was fair and reasonable arrived at purely on commercial basis. The Madras High Court further held that if there is a favoured or special buyer to whom a low price is charged because of extra commercial consideration, e.g. because he is a relative of the manufacturer, the price charged for those sales would not be wholesale cash price for levying excise duty. Regarding the limitation aspect, the ld. SDR submitted that the present proceedings were initated on the basis of set of facts which were different from earlier facts and some a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d 18-5-1990 for the period from September, 1988 to January, 1989 and as such is beyond the normal period of six months stipulated in Section 11A of the Central Excise Act. This show cause notice is hit by time limit as the proviso to Section 11A of the Act cannot be made available as already a show cause notice dated 11-1-1990 had been issued on the same facts and the department had the knowledge of the facts. Once the show cause notice has been issued to the appellants on the same ground, the department cannot invoke the provisions of proviso to Section 11A(1)) of the Act as there is no more any suppression of the facts. Now, we have to see whether the extended period was invokable for demanding the duty under show cause notice dated 11-1- ..... X X X X Extracts X X X X X X X X Extracts X X X X
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