9911796707
TMI Blog2017 (2) TMI 427X X X X Extracts X X X X X X X X Extracts X X X X ..... esent case involves valuation of the gases supplied by the appellant to HPL. The subject matter of dispute is an agreement entered into by the appellant with HPL by which HPL will supply free power to the appellant and in return the appellant is required to supply gases to HPL. The allegation made by the appellant is that the cost of free power supplied by HPL has not been taken into account while determining the value of gas supplied to HPL and the differential duty for gas supplied during the period September 1999 to August 2000 was demanded by issue of show-cause notice dated 4.6.2002. In the impugned order, demand of central excise duty amounting to Rs. 52,38,842/- was made along with an order to pay interest amounting to Rs. 4,59,000/- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ommenced on 5.7.2000. He justified the penalty imposed on the appellant with the argument that but for the investigations undertaken, the undervaluation in the supply of gases would not have come to light. 5. The case has been built on the agreement entered into by the appellant with M/s. HPL. As per the product supply agreement between the two parties, the appellant is required to supply various gases to HPL at a rate negotiated with the condition that HPL will supply free entire electric power required for the operation of the production plant. This arrangement started with the commencement of production in the appellant s factory in the month of January 2000. It is a fact seen from records that the appellant at the time of clearance pai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... suppressed the fact about the agreement and undervalued the gases supplied to HPL. 7. After considering the submissions of both parties and perusal of records, we are of the view that the issue of penalty hinges on the fact whether the appellant has already furnished a copy of the product supply agreement to the department at any time prior to 5.7.2000, the date of visit of the departmental officers. If this fact is confirmed, then the allegation of suppression is not justified and consequently, no penalty is imposable under Section 11AC of the Act. However, if such agreement has been recovered by the departmental officers, only at the time of visit on 5.7.2000, as has been made out in the impugned order as well as in the argument of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
