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TMI Blog2016 (9) TMI 227X X X X Extracts X X X X X X X X Extracts X X X X ..... ttled law that subsequent SCN on identical issue to identical notice cannot invoke extended period of limitation, there is no such estoppel for issue of simultaneous or subsequent SCNs invoking extended periods, for identical noticees, even for identical periods, when the issues alleged in both SCNs are different. Possibly because of misconception and inadequate appreciation of the two aforesaid orders, the appellant sought to convey that both the notices are on same issue and hence dropping of demand in one notice will be a limitation to the adjudicating authority to take any other view in the second one. We further find that even in the course of hearing related to the Tribunal's earlier order dated 05.02.2007, appellant had made the same albeit misconceived argument. The adjudicating authority has carefully considered all the evidences that have emerged during investigation and narrated in the notice. In any case the appellant has submitted that he is contesting the impugned order only on the grounds of limitation. In fact the earlier Tribunal order had set aside the impugned order on the ground of limitation and res judicata. However, based on the ROM application filed by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee or Revenue, to choose and put forth the grounds of appeal that such appellant may find appropriate. These arguments are too flimsy and we hold that the objections of the appellant regarding maintainability of appeal No.E/109/2007 per se are not tenable or acceptable. Demand - evasion of Central excise duty during the period July 2001 to June 2004 - adjudicating authority has discounted overall demand by 5% and accordingly demanded only an amount of ₹ 18,72,890/ apparently under the impression that the demand is based on the highest value of the highest quality brand ,namely "Sri Vasavi" - Held that:- the lower authority has arrived at this conclusion as per details in the chart extracted from the sales records and sales invoices of SVA. On the other hand the department cannot also claim its calculation is unimpeachable in the face of the aforesaid findings of the lower authority. This being so, we are of the considered opinion that 5% of reduction in the demand proposed in the SCN and limiting the confirmed demand to ₹ 18, 72,890/ is just and reasonable and therefore does not call for any interference. Hence dismissed. - E/848, 848-A/2006 & E/254, 109 & 14 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of section 2 (g) MRTP Act, 1969, having financial and business interest in each other, thus the assessable value to be adopted by VPPL in the case of sale to related person SVA, is the price charged by the last related person in the chain, hence VPPL has evaded duty by adopting incorrect assessable value. A show cause notice dated 20.05.2005 was issued inter alia to VPPL proposing demand of duty of ₹ 87,83,409/ allegedly evaded vide such modus operandi for clearances made during the period February 2000 to June 2004 along with interest thereon and also proposing imposition of penalties on them. The SCN also proposed imposition of penalty under Rule 26 of CER, 2002 on SVA. On adjudication, vide Order in Original dated 22.02.2005 the adjudicating authority held that VPPL and SVA are not related persons and dropped the proceedings initiated vide SCN dated 25.02.2005 and also SCN for subsequent period dated 01.08.2005. Aggrieved by this order, the Department has filed this appeal. v. Appeal No. E/254/2007 This appeal has been filed by department, aggrieved by Order in Original 20.04.2006 discussed in para 1.1 supra, on the grounds that while the SCN dated 06.12.2004 p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat the Revenue has not appealed against the Order-in-Original No. 31/2005 dated 22-12-2005 and therefore, the same has attained finality. For the reasons cited above, we set aside the impugned order and allow these appeals with consequential relief. 7. Subsequently, however on an application for rectification of mistake filed by Revenue, the Tribunal recalled it's earlier order dated 05.02.2007. The relevant portion is extracted as below: This is a ROM application filed by the Revenue for rectifying an error apparent on record in our Final Order Nos. 195 196/2007 dated 5-2-2007[2007 (213) 226 (Tribunal)]. Several grounds are raised in the petition. It is pointed out in the petition that in the Final Order cited, the Tribunal had concluded that order-in-original No. 31/2005-06 dated 22-12-2005 and order-in-original No. 36/2005-06 dated 20-4-2006 had dealt with the same issue. It is submitted that the show cause notice basic to the order-in-original No. 31/2005-06, dated 2212-2005 had dealt with the concept of 'related person ' in terms of Rule 10 of the Central Excise Valuation Rules, 2002 (period of dispute is February 2000 to March 2005) and the show cause n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er. The ROM application is disposed of. 8. Accordingly, the appeal has now once again come up before this Tribunal. The Id. counsel Sri. K.S. Ravi Shankar appearing for appellant opened his arguments by questioning the very maintainability of the Appeal No. E/ 109/2007 filed by Revenue and submitted that in case his contention on maintainability succeeds, in sequitor, the Tribunal's Final order No. 195 and 196/2007 dated 05.02.2007 would still sustain. Challenging the maintainability of appeal No. E/ 109/2007, he made two-fold submissions: i. The authorization by Committee of Chief Commissioners has members on different dates, and therefore done in a manner which law does not approve, being in violation of the provisions of Section 35(1B) and 35 E of Central excise Act, 1944. ii. The grounds of appeal are largely verbatim reproduction of the authorization order and further, it does not contain the premises on which revenue challenges the order. 9. In response, the Id. AR Sri Nagendra Rao contended that as per administrative exigencies and as general practice the authorization by the two members of the Committee is considered and obtained by circulation; that there ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted to normal limitation period of one year since invocation of extended period is not justified. vii) The Ld. Counsel clarified that the appellant is prepared to pay up the demand for normal one year period with interest. 12. Countering these arguments, the Id. AR Nagendra Rao submitted that the issue in the two show cause notices are totally different; that in 2004 notice, the allegation is that VPPL had cleared superior quality/brand pipes in the guise of lower quality [brand pipes, hence resulting in undervaluation and short/non payment of duty; however in 2005 notice the issue involved is that VPPL and SVA are allegedly related persons, hence resulting in undervaluation in clearances between the two persons and consequent proposal to demand differential duty thereof. As such dropping of 2005 SCN by one adjudicating authority does not mean that the 2004 SCN has also to be dropped. Regarding the contention of appellant that both the SCNs narrated same set of facts and circumstances, he submitted that this was only because both the issues, though separate, had emanated from a single search/investigation operation conducted by the department; nonetheless it cannot be said th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2(g) of,the MRTP Act or under Rule 10, the price charged by VPPL to SVA is only relevant for payment of duty. Hence the impugned order does not require any interference. 16. In respect of Appeal No. E/254/2007, the Ld AR on behalf of Revenue pointed out that the reduction of proposed demand of ₹ 21,35,228/-in SCN to ₹ 18,72,890/- in Order in Original dated 20.04.2006 is not only arbitrary but is also not based on facts. He submitted that the adjudicating authority was under the impression and apparently gave relief on finding that such corrections is required to be done as the demand is based on the highest value of the highest quality brand Sri Vasavi, whereas, as per the chart, there is receipt of other brands too but in minor quantity. In response the Ld Counsel for appellant reiterated his earlier objection that related Order in Original dated 22.12.2005 having been set aside the present matter should also be dropped by adjudicating authority on the ground of limitation. 17. Heard both sides and perused the appeal records. 18. We find it for a fact that both the SCNs dated 06.12.2004 and 25.02.2005 owe their origin to the visit by department officers to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the name of inferior branded / quality 'Sri Devi'pipes by adopting the latter's sale price for payment of duty and the sales, from their related marketing agency, are made with the actual brands and prices. Being related units, flow back of money towards the price difference between the brands (Sri Devi) for which the invoice is raised and the actual brands cleared, is in the special knowledge of the management of the unit, which is a closely held private limited company, and which is not expected to be transparent. Further , both the units are closely managed by the management of M/s. Vasavi Polymers, by having con 01 over the accounts of the marketing firm and taking decisions on behalf of the firm as discussed supra. This fact is again found echoed in para 29 of the order in original dated 22.12.2005 related to the 2005 notice which is as below:- 29. I have carefully gone through the case records. I find that the proceedings against M/s. Vasavi Polymers relate to two issues, one relating to the under valuation resulting from the willful misrepresentation of the brands in the invoices at the time of removal of the pipes and the other relating to under valu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 31/2003 dated 22-12-2005 was dropped by the same Commissioner, therefore, he should not have taken a different view to hold that there was suppression of facts and the demands were not required to be confirmed for the larger period, in the present case. He points out that in Order-in-Original No. 31/2005 dated 22-12-2005, the Commissioner has accepted the transaction value and therefore, he should not have taken a different view to confirm demands in the impugned order. 23. Coming to the merits of the appeal no. 848/2006, we find that the adjudicating authority has carefully considered all the evidences that have emerged during investigation and narrated in the notice. In any case the Ld counsel has submitted that he is contesting the impugned order only on the grounds of limitation. In fact the earlier Tribunal order dated 05.02.2007 had set aside the impugned order on the ground of limitation and res judicata . However, based on the ROM application filed by Revenue, the Tribunal vide Misc. Order dated 08.09.2010 held that the impugned order had not reached finality and hence ordered recall of its earlier order. In the discussions made above, we hold that the impugned order ..... X X X X Extracts X X X X X X X X Extracts X X X X
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