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TMI Blog2019 (4) TMI 1642X X X X Extracts X X X X X X X X Extracts X X X X ..... Section 4 of the Central Excise Act, 1944. For attracting the provisions of Rule 9 of the Central Excise Valuation Rules, 2000 the goods should be sold to related person as specified either in sub-clause (ii), (iii) or (iv) of Section 4(3)(b) of the Act and not to anyone else. Once law falsifies the liability of appellant in given circumstances, mere mention by appellant in its record that too in balance sheet only will not create any liability. More so when there is no effort by the Department to show whether price at which the duty liability has been discharged is influenced by relationship between the parties. Penalty - extended period of limitation - HELD THAT:- Penalty can be imposed only for contumacious conduct or for willful ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Department observed that the appellant have sold 370.246 MT of their finished goods to their said related buyers during 2014-15 and 2015-16 and thereby evaded Central Excise duty totalling to ₹ 1,21,288/-, in contravention of Section 4(1)(b) of the CEA Act and Rule 8, Rule 9 and Rule 11 of the Central Excise Valuation (determination of price of excisable goods) Rules, 2000. Resultantly, a SCN No. 928 dated 18.05.2017 was served upon the appellant proposing the recovery of aforesaid amount of duty with interest at appropriate rate and the proportionate penalty. The said proposal was initially confirmed vide Order-in-Original No. 11 dated 13.11.2017. The Appeal thereof was rejected vide Order-in-Appeal 002 dated 04.05.2018. Resultantly, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the opinion as follows: 5.1 The findings of original adjudicating authority are that the appellant and M/s. Cosmos Castings (I) Ltd., Raipur, M/s Vaswani Industries Ltd., Raipur and M/s C.G. Ispat Pvt. Raipur are nothing but related persons or inter-connected undertakings in terms of Section 4 (3) (b) (l) of the Central Excise Act, 1944 as the appellant themselves have declared this under Related Parties Disclosures in the balance sheets. As well as under Section 40 A (2) (b) of the Income Tax Act in their Annual Financial Report and even vide their letter dated 21.02.2017, 08.03.2017 09.03.2017. Appellants on the contrary have denied them to be so related. 5.2 The moot controversy therefore is as to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itself w.e.f. 28.05.2012. Practically, it is copy of definition as contained in MRTP Act. 5.3 The definition of relative as specified in Section 2(77) of the Companies Act, 2013 [earlier 2(41) of the Companies Act, 1956] reproduced as under: Section 2(77) relative , with reference to any person, means anyone who is related to another, if- (i) they are members of a Hindu Undivided Family; (ii) they are husband and wife; or (iii) one person is related to the other in such manner as may be prescribed The provisions of Rule 4 of the Companies (Specification of Definition Details) Rules, 2014 which defines the manner as prescribed in claus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he private limited Company. We therefore are of the opinion that buyers and sellers herein are neither the inter-related nor are the relatives. 5.5 The adjudicating authority has failed to appreciate that the provisions of Rule 9 of the Central Excise Valuation Rules, 2000 has been applied in a situation where the buyer is related either in sub-clause (ii), (iii) or (iv) of clause (b) of sub-section (3) of Section 4 of the Central Excise Act, 1944. For attracting the provisions of Rule 9 of the Central Excise Valuation Rules, 2000 the goods should be sold to related person as specified either in sub-clause (ii), (iii) or (iv) of Section 4(3)(b) of the Act and not to anyone else. That the learned adjudicating authority has gr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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