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TMI Blog2006 (7) TMI 498X X X X Extracts X X X X X X X X Extracts X X X X ..... 2004 is for the period from 1-4-2001 to 31-3-2003 and the OIA No. 117/2005 is for the period from 1-4-2003 to 30-9-2003. 2. The brief facts of the case are as follows :- The appellant, M/s. Vishwam Industries (Viswam for short), manufacture Canon branded Kinetisers, a kitchen appliance similar to Hot Plate, on job work basis for M/s. Canan Technologies, Bangalore. The Central Excise officers conducted certain investigations. Based on the investigation, Show Cause Notices were issued to the appellants for confiscation of the seized goods and also for imposition of penalties under Rules 25 and 26 of the Central Excise Rules, 2002. Shri V.P. Viswanathan Nair is the Proprietor of the appellant unit M/s. Vishwam Industries. Smt. Betty Sebastian is the Proprietrix of M/s. Canan Technologies (CT in short). Shri V.D. Sebastian is the Chief Executive of M/s. Canan Technologies Pvt. Ltd. (CTPL in short). 2.1 The main charges against the appellants are as follows :- (i) Viswam manufactured and cleared excisable goods without obtaining Central Excise registration and without following the Central Excise procedures. Further the Canan branded Kinetisers manufactured by them are cl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0/- -do- Smt. Betty Sebastian Proprietrix M/s. Canan Technologies 25,000/- -do- Shri V.D. Sebastian Chief Executive M/s. Canan Technologies Pvt. Ltd. 2,50,000/- -do- (vii) Interest under Section 11AB was demanded. (viii) 1032 numbers of Canan Kinetisers seized at M/s. Viswam Industries, Bangalore and 234 numbers of Canan Kinetisers and 130 numbers of non-stick ware seized at M/s. Canan Technologies, Kerala, were held liable for confiscation. The RF imposed was Rs. 5,00,000/- and Rs. 70,000/- respectively. 3. The appellants strongly challenge the findings of the Adjudicating Authority. 4. Shri B.N. Gururaj, the learned Advocate, appeared for the appellants and Shri K. Sambi Reddy, the learned JDR for the Revenue. 5. The learned Advocate urged the following points :- (i) Based on the investigations, the DGCI Authorities seized 1032 numbers of finished Kinetisers on the ground that the appellant manufactured the goods without registration and cleared them without payment of duty. A Show Cause Notice dated 22-8-2003 was first issued. This Notice, at para 8.2, conceded the admissibility of exemption under Not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rea notified by the Central Government or the State Government as urban area. Before rejecting the certificate issued by the Deputy Tahsildar, the respondent ought to have examined whether Attibele fell within the scope of any of the excluded areas and not looked at how up to date the census data is. (vii) The rejection of certificate issued by the Deputy Tahsildar is for specious reasons. When the certificate was issued, 2001 census data was not available to anyone, either public or government. This data was released only in September 2004. No one could have issued the certificate based on non-existent information. The respondent expects the appellant and the Revenue authority to do the impossible, ignoring the maxim that law does not contemplate doing of the impossible (Lex non cogit ad impossiblia). Hence, the Deputy Tahsildar was justified in issuing certificate based on 1991 Census. Rejection of the certificate on the ground that it was based on 1991 Census is without merit and bad in law. (viii) The respondent erred in holding that merely because the signatory of the Certificate was a Deputy Tahsildar, Attibele ceases to be a rural area. There is no basis for concluding ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rice on the retail package, there can be no question of applying Section 4A. (xv) The Commissioner is bound to consider the applicability of CBEC Circular No. 625/16/2002-CX dated 28-2-2002 which allowed valuation of telephones removed in bulk packing under Section 4 and not under Section 4A, even though telephones were notified under Section 4A. The findings of the respondent do not even refer to the circular. Therefore, the impugned order is liable to be set aside for failure to follow the binding Circular of the Board. In this regard, reliance was placed on the ratio of Dhiren Chemicals v. CCE-2002 (139) E.L.T. 3 (S.C.). (xvi) The Commissioner has ignored the question of jurisdiction. The duty demand is of Rs. 66 lakhs. But, the Notice has been issued by the Joint Director of DGCEI, who is not competent to issue Show Cause Notice. There is no finding at all on this issue. The proceedings in pursuance of Notice issued by the authorities lacking jurisdiction is void ab initio. (xvii) The appellant acted on the written legal advise obtained by the customer M/s. Canon Technologies. Therefore the appellant held bona fide belief that the transaction is valid in law. Therefore, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... heir products under CH 85.43 of CET whereas the original authorities have held the same to be under CH 85.16. In the OIO/OIA, there is no detailed discussion regarding the classification. In the present case, valuation under Section 4A of the Central Excise Act depends upon the classification of the impugned item. The determination of classification in the impugned orders is not satisfactory. Moreover, in deciding that impugned goods are to be valued on the basis of MRP, the original authorities have not considered the applicability of CBEC Circular 625/16/2002-CX dated 28-2-2002 which provides for valuation of goods removed in bulk packing under Section 4 and not under Section 4A. (ii) The appellants had produced a Certificate from the Deputy Tahsildar to the effect that the factory is situated in a rural area. The lower authorities have rejected the Certificate on the ground that the Certificate refers to 1991 Census. It is the contention of the appellant that on that date, that was the only Census available. Further, the original authorities state that the Deputy Tahsildar is normally associated with Town Panchayat/Town Area Committee and, therefore, rejected the Certificat ..... X X X X Extracts X X X X X X X X Extracts X X X X
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