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TMI Blog2005 (2) TMI 643X X X X Extracts X X X X X X X X Extracts X X X X ..... issioner (Appeals) who confirmed the order of the lower authority demanding differential duty and imposing penalties along with interest under Section 11AB of the Central Excise Act, 1944. The issue pertains to valuation of the goods manufactured by the appellant s company. It is seen that the appellants were selling the goods to M/s. Devi Enterprises during the period 1999-2000 and 2000-2001 up to 30-6-2000. The allegation is that M/s. Devi Enterprises is related party and therefore the transaction between the appellants and this firm does not constitute the transaction value. It is also alleged that the appellants suppressed the assessable value with an intention to evade payment of duty. In statements dated 4-8-2000 and 22-9-2000. Shri G ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at the basis for coming to the conclusion that the parties, are related is not sufficient to arrive at the conclusion that the transaction is between related parties. He contended that the facts that a distributor company holds shares in the manufacturing unit need not necessarily means one is interested in the business of the other. He relied on the decision of the Tribunal in the case of Y.N. Shah v. Commissioner of Central Excise, Mumbai-II [2004 (170) E.L.T. 353 (Tri. - Mumbai)] wherein the Tribunal held the above view. The Commissioner invoked the larger period of limitation as he held that the appellants have deliberately suppressed the value of the clearances during the period 1-3-98 to 31-8-2000 by declaring incorrect assessable val ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se, Calcutta [1998 (99) E.L.T. 202 (S.C.)| and the Tribunal decision in the case of Narendra Machine Works (P) Ltd. v. Commissioner of Central Excise, Rajkot [2001 (128) E.L.T. 118 (Tri. - Del.)] wherein it was held that mutuality of interest in each other business can be established from circumstances similar to the ones in the present case. 5. We have given careful consideration to the rival submissions made by both the parties on the issue of invocation of larger period of limitation. We observe that the appellants have not disclosed that they are selling their goods through a related person. The Managing Director of the appellant s company is a partner in the distributing firm. Further, it is brought out that the distributing company ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appellants would also co-operate with the department to do so. A reasonable opportunity may be given to the appellants before re-determining the value as indicated above. In so far as the penalty imposed under Section 11AC is concerned, we observe that since correct duty amount has to be arrived at, penalty under Section 11AC cannot be sustained at this stage. The adjudicating authority after determining the duty amount can impose a penalty under Section 11AC. In so far as the penalty on the Managing Director is concerned, the adjudicating authority may take a fresh view on this as well. The appeals are allowed by way of remand in the following terms :- (a) The transactions between the appellants and M/s. Devi Enterprises are held to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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