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TMI Blog2024 (9) TMI 1023X X X X Extracts X X X X X X X X Extracts X X X X ..... .e., one being the Proprietary concern and another a Private Limited Company. The issue of clubbing together for the purpose of getting exemption requires consideration on the basis of the transaction of the business which cannot be assessed only on the basis of the fact that one unit is a Proprietary concern and another is Private Limited Company. The issue has been raised that the appellant has not raised the issue of perversity. Even accepting that the issue of perversity has not been raised but if the error is apparent on the face of the order, then the Court while considering the propriety of the order which has been challenged is to consider on the basis of the principle as to whether the order assailed suffers from perversity or not - Perversity means that if anything has not been considered if so placed or erroneously been considered and if that be so, it is incumbent upon the Court to law to go into the propriety of the order by taking into consideration the issue of perversity. This Court has considered the order impugned and after taking into consideration the specific consideration given by the original authority based upon the documents which is lacking in the order pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he specified limit as stipulated in the said notification. The investigation also revealed that MM has removed goods from its own premises as well as from the factory of MMPL with intent to evade central excise duty. Thus MM during the period from 2003-04 up to 07.11.2007 by suppression of materials facts in collusion with MMPL evades Central Excise duty. 4. The further case is that MMPL has been created by Shri Arun Agarawal, proprietor of MM, subsequently and both the factories MM and MMPL belong to him and his Hindu Undivided Family. Shri Arun Agrawal has been managing and controlling business activity of both MM and MMPL. The documents show that orders were placed on MM, but goods were supplied by MMPL and also payments were received by MMPL. This not only confirms financial complexity and mutuality of financial interest, but also confirms financial flow back from MM to MMPL. There are also evidences that though purchase orders, initially placed on MM, were got amended in the name of MMPL who supplied the goods, payments were received by MM and MMPL as also financial flow back from MMPL to MM. 5. It is the further case of the Revenue that MM has been sharing profit with MMPL in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... part of the assessable value of such goods cleared and be liable to central excise duty? (4) Whether duty on goods manufactured and used for repairs and reconditioning are leviable or not? (5) Whether amount of Rs. 1.23 Crore seized from the premises of MM/MMPL pertained to the sale proceeds of unaccounted goods cleared clandestinely and hence are liable to confiscation? And (6) Whether they are liable for penalty as proposed in the notices? 13. The issues have been decided by passing following orders :- ORDER Having regards to the facts and circumstances of the cases, I pass following orders:- (1) I determine Central Excise duty show cause notice wise as under:- (a) Rs. 1,42,35,345/- in respect of show cause notice DGCEI F.No.154/KZU/KOL/JSR/Gr.F/08/2976 dated 26.04.2008; (b) Rs. 40,39,548/- in respect of show cause notice C.No. V(72)(15)110/APP/ADJ/JSR/08/11642-11645 dated 19.11.2008; (c) Rs. 12,22,888/- in respect of show cause notice C.No.V(72)(15)69/APP/ADJ/JSR/2009/13314-13317 dated 08.10.2009; and (d) Rs. 6,84,451/- in respect of show cause notice C.No. V(72)(15)17/APP/ADJ/JSR/2010/7340-7343 dated 07.07.2010 recoverable from M/s Mica Mold, Jamshedpur and M/s Mica Mold, Jams ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e as MMPL, has preferred the present appeal. Submission made on behalf of the appellant-Revenue 17. Mr. Amit Kumar, learned counsel appearing for the appellant, has submitted by referring to the consideration made by the Assessing Officer which has been taken note and considered at Para 10.1.2 of the aforesaid order as appended as Annexure-3 dated 31.03.2011. 18. It has been contended that the specific case of the Revenue before the Assessing Officer was that both the units have been recognized by the customer, i.e., Indian Railways (Eastern Railway and Southern Railways) as one and the same vendor, being code 68457. They are operating from one and same office. The search had been conducted and in course thereof, most documents of MM were found in the declared office of MMPL. Stock register of both MM and MMPL were found common. The stock register of all types of brush holder, seized from MMPL factory premises have been found either supplied by MM or MMPL to Railways. But no satisfactory reply has been furnished while responding to the said show cause notice. The Revenue, in view of the aforesaid circumstances, has found that the Stock Register for Brush Holder (finished goods for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uments of MM were found in the declared office of MMPL. The stock register of both MM and MMPL were found common. 26. The learned counsel appearing for the Revenue, based upon the said factual aspect, has submitted that the stock register other documents were found in the declared office of MMPL factory premises and finding so recorded that merely because office is common and Directors of the Private Limited Company are the sons of the Proprietor of the firm are not only two reasons as has been found to be available by the Assessing Officer, rather, in addition to the aforesaid two reasons other reasons have also been there which led the Assessing Officer to answer the Issue No.1 in favour of the Revenue. 27. The learned counsel, based upon the aforesaid ground, has submitted that the impugned order, so far as consideration of Issue No.1 is concerned, needs to be interfered with. Submission made on behalf of the Respondent 28. Per contra, Mr. Sumeet Gadodia, learned counsel appearing for the respondent-assessee, has submitted by referring to paragraphs 9 and 13 of the counter affidavit wherein the grounds have been taken that both the units are two independent entities having separ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nswer to Q. 27 stated that it showed that the goods were either supplied by MM or MMPL to Railways. When asked to show as to under what documents goods from MM were received by MMPL, he could not reply. Thus the stock register for brush holder (finished goods for both MM MMPL) shows supplies to and from MM, and has been maintained in a common manner with both showing purchase of raw materials and manufacture of finished goods for each other. Similarly Annexure-9 to the show cause notice showing receipt and issuance of store items were maintained commonly for both MM MMPL. This is a clear evidence of common procurement of raw material, common storage, common manufacturing and common accounting of goods, which shows mutuality of interest between the two units. 35. The reason for referring the said finding is in order to assess as to whether the original authority has taken into consideration the relevant documents while coming to the conclusion regarding the issue of mutuality on interest in between the two units. 36. It is evident from the consideration so made by the original authority as referred in paragraph 10.1.2 wherein both the authorities have taken into consideration the va ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t on the face of the order, then the Court while considering the propriety of the order which has been challenged is to consider on the basis of the principle as to whether the order assailed suffers from perversity or not. 43. Perversity means that if anything has not been considered if so placed or erroneously been considered and if that be so, it is incumbent upon the Court to law to go into the propriety of the order by taking into consideration the issue of perversity. 44. The word perversity has been defined by Hon'ble Apex Court in the case of Arulvelu and Another v. State represented by the Public Prosecutor and Another [(2009) 10 SCC 206] at paragraph 27, which is quoted hereunder:- 27. The expression perverse has been defined by various dictionaries in the following manner: 1. Oxford Advanced Learner's Dictionary of Current English, 6th Edn. Perverse. Showing deliberate determination to behave in a way that most people think is wrong, unacceptable or unreasonable. 2. Longman Dictionary of Contemporary English, International Edn. Perverse. Deliberately departing from what is normal and reasonable. 3. The New Oxford Dictionary of English, 1998 Edn. Perverse. Law (of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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