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TMI Blog2023 (10) TMI 7X X X X Extracts X X X X X X X X Extracts X X X X ..... registration issued by Central Excise authorities to SRC RRPL firms, books of accounts etc., to substantiate that the units are functioning independently and not dummy units as alleged. Considering the law laid down by the Apex Court in the matter of Commissioner of Central Excise, New Delhi Versus Superior Products and Goodyear South Asia Tyres Pvt. Ltd. [ 2015 (8) TMI 61 - SUPREME COURT] , wherein it is categorically held that all the three units even few of the directors or responsible persons are one and same, they cannot be considered as related persons since all the three were having separate legal entities. Undervaluation - HELD THAT:- The document relied on by the adjudicating authority to adopt the value of the rubber cannot be considered as admissible evidence. Moreover, appellant had produced documents issued by Rubber Board regarding the average value of rubber at the relevant time. If the Investigating authority had reason to believe that the cost of rubber at the relevant time was higher than the value shown in the books of accounts, they could have obtained authentic data from the Rubber Board or other agency than relying on unsigned/unauthenticated docume ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sustainable since the show-cause notice proposes the demand of excise duty being the duty on the goods cleared by adopting lesser value for effecting clearance through related persons during the period from 2001-04, whereas on the other hand the authorities alleged that the firm SRCL PRCL are non-existing unit and only dummy units of the appellant. The learned counsel for the appellant further submits that M/s. Surya Rubber and Chemical Ltd., (SRCL) is a partnership firm issued with registration certificate on 07.11.2002. M/s. PRCL is a Private Limited Company incorporated vide certificate of incorporation and having a factory in Hindupur. The learned counsel further submits that the show-cause notice was issued demanding duty from RRPL on the ground that the goods were cleared by adopting lesser value for effecting clearances through related persons. The learned counsel also draws our attention to the Final Order in the case of Hind Hydraulic Engg. Versus CCE, Delhi-IV reported in 2019 (370) E.L.T. 1685 (Tri.- Chan.). Learned counsel also submitted that the show-cause notice has not alleged that RRPL, SRCL PRCL are related persons as defined in sub-clause (i), (ii), (iii) o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pt the market value of rubber @ 49 per kg. The above said documents cannot be considered as admissible evidence since it is neither signed nor source of the said document is disclosed in the show-cause notice. The Learned counsel also draws our attention to correspondence made by assessee with Rubber Board, where clarification issued by Rubber Board vide its communication dated 28.03.2022 shows that the average price of rubber at the relevant time was only Rs. 31 to Rs.36.67 and not Rs.49 as considered by the adjudicating authority. The learned counsel also draws our attention to large number of documents showing that the PRCL and SRCL were existing with the due permission from concerned statutory authorities. In support of the above, the Learned counsel also draws our attention to the report of the Inspection Committee, dated 19/10/2002 on the visit to the State based SSI units manufacturing pre-cured tread rubber and allied materials. To support the above submissions, the Learned Counsel draws our attention to the judgment of Hon ble Supreme Court in the case of Commissioner of C.Ex., Cus. S.T., Calicut Versus Cera Boards and Doors reported in 2020 (373) E.L.T. 794 (S.C) wherei ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion (1) or whether the sales in question fell under clause (b) of sub-section (1) of Section 4; (ii) Failure to find out, in cases covered by Section 4(1) as it stands amended by Act 10 of 2000 with effect from 1-7-2000, whether the sales in question fell under clause (a) or clause (b) of sub-section (1) of Section 4; (iii) Failure to find out, in the event of the sales in question falling under clause (b) of sub-section (1) of Section 4 (before or after the amendment), whether the valuation had to be done only in accordance with the Rules (1975 Rules or the 2000 Rules, as the case may be), and (iv) Failure to find out, in cases covered by Section 4(l)(b), the specific rule that is applicable among the 1975 or 2000 Rules, as there are different rules covering different contingencies, both in the 1975 Rules and in the 2000 Rules. 98. Since the Adjudicating Authorities as well as the CESTAT failed to make a determination as indicated above, we are of the view that the orders of remand passed by the Tribunal, though for completely different reasons, were justified. Hence the appeals are liable to be disposed of, confirming the orders of remand passed by CESTAT ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ns, namely (i) the goods are sold for delivery at the time and place of removal, (ii) the assessee and buyer are not related and (iii) the price is the sole consideration, are satisfied. This is because such cases will fall under Section 4(1)(a). (III) In cases where one or more of the aforesaid three conditions are not satisfied, and also in cases where there is no sale, the Adjudicating Authority should treat the cases as falling under Section 4(1)(b) and hence take recourse to the Central Excise Valuation (Determination of Price of Excisable Goods) Rules, 2000. (IV) If a case falls under Section 4(l)(b) and the Adjudicating Authority takes recourse to the method of valuation prescribed in the 2000 Rules, he shall find out which among the relevant rules would apply to the case on hand before proceeding with the valuation. 4.2 Learned counsel also cited the judgment in the case of Commissioner of Central Excise, New Delhi Versus Superior Products reported in 2008 (230) E.L.T. 3 (S.C) to support their case. 5. Heard the Learned counsel for the appellant and the Learned Authorized Representative for the Revenue and perused the records. 6. The learned AR for th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... RC when there is no billing between the two companies. The learned AR also draws our attention to the documents produced by the appellants regarding reference to the Inspection Committee, wherein it is stated that during the course of inspection of the firms located in different places of Karnataka, it was observed that most of the tenderers have been quoting under 2 or 3 firms though they do not possess the required machineries for manufacturing all the three items namely, Pre-cured Tread Rubber, Bonding/Cushion Gum and BVC/USC in all these firms. 7. We have gone through the records and also the submissions made by both sides. Prima facie, we have found strong force in the statements made by the appellants that when adjudicating authority has held that RRPL, SRC and PRC are related persons, it contradicts the finding in the impugned order that SRC and PRC are only dummy units created for procuring the tenders offered by KSRTC. In addition to that during hearing, the Learned counsel for the appellant draws our attention to large number of documents including registration, deed of partnership, VAT registration and proforma of registration issued by Central Excise authorities to S ..... X X X X Extracts X X X X X X X X Extracts X X X X
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