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TMI Blog2018 (6) TMI 913X X X X Extracts X X X X X X X X Extracts X X X X ..... the business of the said company. The other shareholders of the said company are also close relatives of Sh. Rajesh Ahuja and Sh. Suresh Ahuja. 2. The appellant did not disclose the fact of their relationship with M/s. PSSTL, and M/s. BAI to the Central Excise Department and therefore they failed to correctly determine and discharge the duty liability in respect of sale of their finished goods to M/s. PSSTL, and M/s. BAI during the period in question. The fact of sale of finished goods to their related units/ interconnected units came to the notice of the Department during the audit. It was also found that the rate of goods sold by them to PSSTL/ BAI are lower than the rate of goods sold by them to outsiders. During the course of audit of the books of accounts of the appellant for the period July, 2012 to August, 2013 the internal audit, Central Excise, Raipur has requested the appellant to produce any records, statutory or private showing the size wise production, clearance of stock of their finished products but the same were not produced by them. Since it was apparent that the appellant have contravened the Provisions of Section 4(1)(b) of Central Excise Act, 1944 read with Ru ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gned order, is justified in view of the facts of the present case. In order to appreciate the issue involved we have to go through Section 4(1)(b), 4(3)(b) of the Central Excise Act, 1994 and Rules 4, 11 and 11A of the Central Excise Valuation (Determination of price of Excisable Goods) Rules, 200 which are reproduced as under:- Section 4(1)(b), Central Excise Act, 1944 4. Valuation of excisable goods for purposes of charging of duty of excise.- (1) Where under this Act, the duty of excise is chargeable on any excisable goods with reference to their value, then, on each removal of the goods, such value shall- (a) in a case where the goods are sold by the assessee, for delivery at the time and place of the removal, the assessee and the buyer of goods are not related and the price is the sole consideration for the sale, be the transaction value; (b) in any other case, including the case where the goods are not sold, be the value determined in such manner as may be prescribed. xxx xxx xxx Section 4(3)(b), in for the purpose of this Section (b) persons shall be deemed to be "related" if- (i) they are inter-connected undertakings; (ii) they are relatives; (iii) amongs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and 11 of the Central Excise Valuation (Determination of price of Excisable Goods) Rules, 2000 Rule 4 The value of the excisable goods shall be based on the value of such goods sold by the assessee for delivery at any other time nearest to the time of the removal of goods under assessment, subject, if necessary, to such adjustment on account of the difference in the dates of delivery of such goods and of the excisable goods under assessment, as may appear reasonable. Rule 11. If the value of any excisable goods cannot be determined under the foregoing rules, the value shall be determined using reasonable means consistent with the principles and general provisions of these rules and sub-section (1) of section 4 of the Act. 6. The ld. Counsel for the appellant submits that the mere fact that the appellant and the buyer are interconnected undertakings is not sufficient to establish that clearance has been made to "Related Person" and he relied upon the order of this Tribunal said to be in Appellant's own case, in the matter of C.C.E Raipur Vs. Orient Steel Re-Rolling Mill 2014 (312) E.L.T 686 (Tri.- Del.) in which it was held that the conditions prescribed in Rule 10 of Cen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of PSSTL of 2010-11, 2011-12 etc., under the Related party disclosures, discloses as under: Name of Related Party Nature of Relationship 1. Shri Suresh Ahuja (Brother of Shri Rajesh Ahuja) 2. Shri Rajesh Ahuja (Brother of Shri Suresh Ahuja) 3. Shri Ritesh Ahuja (Son of Shri Suresh Ahuja) 4. Shri Nitesh Ahuja (Son of Shri Rajesh Ahuja) Key Managerial Person 1. Orient Ispat Pvt. Limited 2. Bhilai Structrual 3. Orient Steel Re-rolling Mill Associated Concern 1. Smt Mala Ahuja (Wife of Shri Suresh Ahuja) 2. Smt. Rekha Ahuja (Wife of Shri Rajesh Ahuja) 3. Rajesh Ahuja (HUF) 4. Suresh Ahuja (HUF) 5. Shri Nitesh Ahuja (Son of Shri Rajesh Ahuja) 6. Shri Ritesh Ahuja (Son of Shri Suresh Ahuja) Relative of Key Managerial Persons The Balance Sheet/ Annual Report o BAI (a partnership firm), discloses the profit sharing Ration as under: Name of Partners Profit Sharing Ration 1. Shri Ritesh Ahuja (Son of Shri Suresh Ahuja) 2. Shri Nitesh Ahuja (Son of Shri Rajesh Ahuja) 3. Smt. Mala Ahuja (wife of Shri Suresh Ahuja) 4. Smt. Rekha Ahuja (Wife of Shri Rajesh Ahuja) 30% 30% 20% 20% It is seen from the above arrangements in all the three companies that the key managerial positions he ..... X X X X Extracts X X X X X X X X Extracts X X X X
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