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TMI Blog2008 (4) TMI 119X X X X Extracts X X X X X X X X Extracts X X X X ..... ication Co. from whom a sum of Rs. 23,23,349/-stands demanded as duty and equal amount of penalty stands imposed under Section 11 AC. Appeal No. 3715 is by Mrs. Kukky Oberoi, Proprietrix of M/s Kavantry Springs Fabrication Co. on whom a penalty of Rs. 5,00,000/- stands imposed. 2. Heard both sides. 3. The relevant facts ,in brief, in appeal No. 3712 by M/s Kobe Suspension Co. Pvt. Ltd. are as follows :- (a) The appellant is a manufacturer of Steel leaf springs who the supply the products to various State Government Transport Undertakings. (b) The various State Government Transport Undertakings have a nodal agency known as ASTRU who notify the rates and quality for leaf springs to be supplied to various State Government Undertakings. ASTRU approves the sources of raw materials and their prices. For this purpose, the appellant as a manufacturer of leaf springs was required to file periodical returns to ASTRU about their sources of procurement of raw materials and the prices at which the raw materials were purchased from the approved sources. (c) The returns submitted to ASTRU by appellant was certified by the Chartered Accountant and also signed by M.D. of the compa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ire raw material for manufacture of leaf springs by the same job worker was not correct and accordingly demanded the duty of Rs. 23,23,349/- from the appellant. 5. The other appeals are by Mr. Uberoi, M.D. of M/s Kobe Suspension Co. Pvt. Ltd. and Mrs. Uberoi, Proprietor of M/s Kavantry Springs Fabrication Co. against the penalties imposed on them. 6. Learned advocate Shri J.P. Kaushik, on behalf of M/s Kobe Suspension Co. Pvt. Ltd. submitted the following :- (a) The demand against M/s Kobe Suspension Co. Pvt. Ltd. is based on returns submitted by them to ASTRU. The invoices submitted by them to ASTRU were manipulated ones. They were not related to actual purchase of raw materials from the said parties. The quantity, the value and the date of invoice were manipulated with a view to get an inflated price for their supply of final products to the various transport companies. (b) He submits that based on the same investigation show cause notices were issued alleging clandestine removal in respect of M/s Sun Flag Iron Steel Ltd., M/s Star Wire (I) Ltd., M/s Modern Steel Ltd. and the appellant was a co-noticee in the said proceedings. The Commissioners (Appeals) in whose ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... submitted that the demand has been made in respect of clearances attributed to M/s Kavantry Springs Fabrication Co. based on the average weight of 7.484 Kgs. and 7.58 Kgs. for different years and adopting average price of 234.73 per leaf springs which relate to products actually manufactured by M/s Kobe Suspension Co. Pvt. Ltd. Since, M/s Kavantry Springs Fabrication Co. themselves were selling the product and the average price and average weight were available, the same should have been adopted. The allegation that they were manufacturing with the brand name of Fantum was not substantiated. (e) If duty demand is confirmed against M/s Kavantry Springs Fabrication Co. then the benefit of Cenvat credit on the raw materials which has been used in the manufacture of such springs should be granted to them. The sale value of M/s Kavantry Springs Fabrication Co. should be treated as cum duty price and demand should be re-worked. 8. Learned D.R. in respect of M/s Kobe Suspension Co. Pvt. Ltd. submits that notwithstanding dropping of proceedings against three of the suppliers, the findings of the Commissioner against them is based on other evidence such as shortage of raw materials, s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d in respect of none of the parties, the allegations are held to be true, the confirmation of demand and imposition of penalty are not warranted. Also, the imposition of penalty on Shri K.S. Oberoi for his alleged role in evasion by M/s Kobe Suspension Co. Pvt. Ltd. cannot be sustained. 12.1 M/s Kavantry Springs Fabrication Co. claims that they have been only into trading and that they have sent materials to a job worker and got finished goods and traded them. We are unable to accept that M/s Kavantry Springs Fabrication Co. have sent under the delivery challans to the job worker only the raw materials and the details regarding the number and variety of leaf springs mentioned in such delivery challans were basically in the nature of orders placed for the final product. We have carefully examined the delivery challans which are basically meant for sending goods specified therein and to get acknowledgment for receipt of the same from the recipient's end. The claim that it specified the end product sought to be manufactured out of the materials send by them appears to be an after thought. The amount indicated as job charges also admittedly do not correspond to charges payable for ..... X X X X Extracts X X X X X X X X Extracts X X X X
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