9911796707
TMI Blog2024 (7) TMI 1393X X X X Extracts X X X X X X X X Extracts X X X X ..... M/s Khyati Ispat Private Limited [Khyati Ispat] and ordering for a recovery of the said amount under section 11A(4) of the Central Excise Act, 1944 [the Central Excise Act] with penalty and interest. 2. Khyati Ispat claims to have sold or cleared finished goods like angles, channels and joist to independent buyers as well as to a related buyer M/s Shri Ashutosh Engg. Industries [Ashutosh Engg. Industries], which is engaged in the manufacture of fabrication and galvanization of iron and steel items. Khyati Ispat and Ashutosh Engg. Industries are owned or controlled by the same persons or group. 3. It appeared to the department that the assessable value of goods sold or cleared to the related party i.e. Ashutosh Engg. Industries for the per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and Shri Basant Kumar Agarwal who are the two Directors of the appellant are also the Directors of M/s.Shri Ashutosh Structures Pvt.Ltd., whose subsidiary is buyer M/s. Shri Ashutosh Engg. Industries. xxxx xxxx It is also not disputed that the buyer M/s. Shri Ashutosh Engg. Industries is a subsidiary of M/s. Ashutosh Structures Pvt.Ltd. In view of this, I find that the appellant as well as the buyer M/s.Shri Ashutosh Engg. Industries are controlled by the same persons Virender Kumar Agarwal and Basant Kumar Agarwal. Therefore, I find that the appellant and M/s. Shri Ashutosh Engg. Industries are interconnected undertakings in terms of Section 4(3)(b) (i) of the Act. 11.1. Rule 10(b) deals with situations where the appellant and the buyer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch of CESTAT, New Delhi supra. 13. In view of the above discussions and provisions of law, I hold that the findings of the adjudicating authority that the valuation of the goods is to be governed in terms of Section 4(3)(b) of the Central Excise Act, 1944 read with Rule 8 & 9 of the Central Excise Valuation (Determination of Price of Excisable Goods) Rules, 2000 is not correct. The goods are sold to inter-connected undertaking, as per sub-clause (i) of sub-section 3 of Section 4 of the Act but is not related as per sub-clause (ii) to (iv), as discussed above, therefore, the value shall be determined as if they are not related persons for the purpose of sub-section (1) of Section 4 of the Central Excise Act, 1944 read with Rule 10(b) of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... raised in this appeal. The relevant portion of the decision of the Tribunal in the matter of the appellant, but for an earlier period, is reproduced below: "19. In this case, it is undisputed that the buyer Ashutosh is owned by M/s Ashutosh Structures Pvt. Ltd. which has four Directors, two of whom are the same as the Directors of the assessee. In other words, Shri Virender Kumar Agarwal and Shri Basant Kumar Agarwal who are the two Directors of the assessee are also the Directors of M/s Ashutosh Structures Pvt. Ltd. whose subsidiary is the buyer Ashutosh. 20. In fact, this aspect has come to light from the assessee's own disclosure under the head of "related party disclosure" as per the Accounting Standard 18 of Institute of Charte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... business interest in the other direction namely that there is no evidence that the buyer was interested in the business of the assessee. Therefore, we find that they are not related persons in terms clause (iv) of section 4(3) (b). 23. We further proceed to see if the appellant and the buyer Ashutosh are related as per clause (ii) or clause (iii). The term "relative‟ in Section 4 (3) (b) (ii) is explained in Explanation (vi) Clause (III) (ii) as follows: "relative shall have the meaning assigned to it in Clause 41 of Section 2 of the Companies Act 1956." 24. Section 2 (41) of the Companies Act defines relative as "anyone who is related to such a person in any of the ways specified in Section 6 of the Companies Act and no others" ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
