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TMI Blog2008 (10) TMI 556X X X X Extracts X X X X X X X X Extracts X X X X ..... chinery etc. of the CBL under Section 173Q(2) of the Act, with option to be redeemed on fine of Rs. 2.5 lakhs, and (d) imposed penalty of Rs. one lakh and Rs. two lakhs on Mrs. Zainab Chauhan, Proprietor of M/s. Apex Traders and Shri Ashish Kumar Sethi, Director of CBL respectively under Rule 209A of the Central Excise Rules, 1944. 1.1 CBL is a company engaged in manufacture of 'Flavoured Ready Syrups (FRS) of four flavours - Coca Cola, Thums Up, Limca and Fanta. Shri Ashish Kumar Sethi is its Director. The FRS are chargeable to Central excise duty under sub-heading 2108.11 of the Central excise tariff. It was being sold in 18 litre canisters which are used in soft drink dispensing machines M/s. Golden Agro Products Ltd. (GAPL) is the holding company of CBL and GAPL is, in turn, held by M/s. Aqua Minerals (P) Ltd. (hereinafter referred to as AMPL). Shri Ramesh Chauhan is the Chairman of AMPL having 53% holding in it and his wife Mrs. Zainab Chauhan has 33% holding in AMPL. Mrs. Zainab Chauhan is the Proprietor of M/s. Apex Traders. 1.2 Prior to 8-3-97 CBL were clearing the FRS manufactured by them to their depot situated in Village Ghazipur, New Delhi and from the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... /s. Apex Traders cannot be alleged on the basis of post removal marketing activities of M/s. Apex Traders. The allegation that M/s. Apex Traders were allowed by CBL to make huge profits at CBL's cost, by undertaking post removal activities of marketing is not correct. The ROC of Rs. 180/- per canister being collected by M/s. Apex Traders from its customers and paid to CBL (as canister belonged to CBL) had been fixed by the Bottler's Association for metro cities. One look at the balance sheets of CBL and M/s. Apex Traders belies the Revenue's assertion of CBL suffering losses and M/s. Apex Traders making huge profits. (4) The Revenue has already accepted a lower market price for the identical products i.e. FRS of Coca Cola brands manufactured by CBL's neighboring factory - Moon Beverages Ltd. during the same period. The assessable value of same goods being manufactured by M/s. Moon Beverages Ltd. during the same period was Rs. 28.5 per litre as against CBL's assessable value of Rs. 32/- per litre. (5) Since CBL and M/s. Apex Traders are not related persons, there is no suppression of facts on the part of CBL, if they did not file the related persons price declaration und ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (c) if answer to questions (a) & (b) is in the affirmative, whether the longer limitation period under proviso to Section 11A(1) of the Act is available to the Department for recovery of short paid duty. 4. Coming to the first point of dispute, the definition of 'related person' in Section 4 of the Act during the period of dispute was as under - " 'related person' means a person who is so associated with the Assessee that they have interest, directly or indirectly in the business of each other and includes a holding company, a subsidiary company, a relative and a distributor of the assessee, and any sub-distributor of such distributor. Explanation - In this clause, 'holding company', 'subsidiary company' and 'relative' have the same meanings as in the Companies Act, 1956". 4.1 The revenue seeks to bring CBL and M/s. Apex Traders within the purview of the term - 'related persons' on the following grounds :- (i) The CBL is held by GAPL and the GAPL is, in turn, held by AMPL, whose Chairman is Shri Ramesh Chauhan having 53% holding in AMPL. M/s. Apex Trader is owned by Mrs. Zainab Chauhan, wife of Shri Ramesh Chauhan and Mrs. Zainab Chauhan has 33% holding in AMP ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case of Powertech International v. CCE, Mumbai-II (Supra), this Tribunal has held that M/s. Powertech International and his customer HVIE are 'related persons' as both the companies are held by one Shri Venugopal Dhoot and his close family members and Shri Himat Vora and his family members. However, this judgment is not applicable to the facts of this case, as there is no evidence to prove that M/s. Apex Traders is a dummy company actually controlled by Shri Ramesh Chauhan, Chairman of AMPL, the holding company of GAPL, which, in turn, is the holding company of CBL. Moreover, Hon'ble Supreme Court in the case of Alembic Glass Industries Ltd. v. Collector of Central Excise & Customs reported in 2002 (143) E.L.T. 244 (S.C.) has doubted its earlier judgment in case of Calcutta Chromotype relied upon by the Tribunal in the case of Powertech International (Supra). 4.2.2 The facts like the factories of CBL and M/s. Apex Traders being adjacent to each other and CBL and M/s. Apex Traders sharing the same office and same godown, in our view, are not relevant for deciding the question as to whether the two companies are 'related persons'. It is not the allegation of the department tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 28.47 per canister respectively. However, the impugned order does not discuss as to on what basis the figure of Rs. 28.47 per canister as actual transport/door delivery charges and the figure of Rs. 44 per canister on actual ROC charges have been arrived at. The appellants have claimed that the ROC charges of Rs. 180/- per canister of 18 litre and transport and delivery charges of Rs. 540/- per canister are based on the rate fixed by the bottler's association. But no finding has been given by the Commissioner on this contention of the Appellant. Hon'ble Supreme Court in case of Commissioner of Central Excise, Meerut-I v. Bisleri International Pvt. Ltd. reported in 2005 (186) E.L.T. 257 (S.C.) has held that rent on containers (ROC) which is rent equivalent to the interest collected by the bottler (assessee) on account of delay in returning of empty crates/bottles to get empty crates/bottles immediately or otherwise assessee bottler would be required to make additional investment towards maintaining additional inventory of crate/empty bottles, is not includable in the assessable value of the aerated waters. Similarly, when the transportation of the goods from the place of removal to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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