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TMI Blog2002 (6) TMI 111X X X X Extracts X X X X X X X X Extracts X X X X ..... en manufacturing their goods under the brand name 'Thermotech' and 'Thermoking'; that they stopped manufacturing activities since March, 1995 but the trading activities remained continued till March/April, 1996. He, further, submitted that the Central Excise Officers visited the factory premises of M/s. Thermoking, proprietorship concern of Pradeep Khanna, and M/s. Flevel International, a partnership firm of Pradeep Khanna, and his wife Neera Khanna; that both these units were engaged in the manufacture of electrical appliances; the Officers found the records pertaining to the appellants; that the Department, after conducting enquiries from their buyers and Sales Tax Department issued a show cause notice dated 30-11-1998 for demanding duty amounting to Rs. 77,04,883/- for the period from 1993-94 to 1995-96 on the ground that they had clandestinely removed the goods; that the Annexures A, B and C to the show cause notice were prepared on the basis of parallel invoices; that the Commissioner, under the impugned Order dropped the demand raised in Annexures 'D' and 'E' but confirmed the demand of Central Excise duty Rs. 58,39,070/- after extending reduction of duty on duty-cum-sale pri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tioned that goods valued at Rs. 30,62,119/- were included in the diary private ledger maintained by Shri V.K. Shourie and recovered by the officers on 4-8-97; that the demand of duty in respect of such entries had already been raised against M/s. Thermoking and the matter has been settled under Kar Vivad Samadhan Scheme (KVSS); that, therefore, raising of the demand against the appellants is not legally correct and amounts to charging of duty twice for which there is no legal sanction. 3.4 The learned Advocate also contended that part of the demand of duty is in respect of invoices which find mention in R.T.12 Returns and which are, therefore, not parallel invoices; that no demand of duty can be raised in respect of such invoices. 4. Regarding use of brand name "Thermoking", the learned Advocate submitted that the brand name is not registered and prior to 1-4-94 they were using the brand name and were availing the benefit of small-scale exemption; that there is nothing on record by way of any evidence which could establish the brand name 'Thermoking' being owned by M/s. Thermoking; that like M/ s. Thermoking, they had also been using the said brand name; that there are instance ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ermoking"; that Shri Rajesh Kumar, ex-employee of Thermotech, in his statement has admitted that 'Thermoking' was the brand name of M/s. Thermoking and the same was affixed on the impugned goods; that this fact has also been confirmed by Shri D.C. Chandla, Marketing Manager and Shri V.K. Shourie, Marketing Manager, in their respective statements; that the Board's Circular, referred to by the learned Advocate, pertains to locks and other similar goods since there is a general practice in respect of locks to put any name thereon by the manufacturers; that the goods involved in the present matter are not sold in 'similar fashion' as the locks and as such benefit of SSI Notification is not available to the goods manufactured and cleared by the Appellant No. 1. He, further, submitted that as per Notification No. 1/93, brand name of another person may be registered or not registered and its use is sufficient for denying the benefit of the SSI Notification; that if the contention of the learned Advocate is accepted, unregistered brand name will not come within the purview of Para 4 of Notification No. 1/93. He also emphasized that in the present matter, the name of the Company which is ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t none pertained to the returned goods. He finally submitted that penalty is imposable on the Appellant No. 1 as the Central Excise duty has been evaded. He relied upon the decision in Z.B. Nagarkar v. U.O.I., 1999 (112) E.L.T. 772 (S.C.). He also mentioned that a penalty under Rule 209A is imposable on Pradeep Khanna as he was looking after work of Appellant No. 1 which is evident from the statement of Rajesh. 6. In reply, the learned Advocate mentioned that the Board's Circular dated 1-9-94 applies to all the goods specified under Notification No. 1/93-C.E. and not only to locks. He reiterated that the definition of 'manufacture' in Sales Tax Act is much wider and if their activities were beyond the purview of definition of manufacture, then only they can be called to be engaged in trading under the U.P. Sales Tax Act; that in their reply to the notice they had mentioned that they were doing packing of the goods which amounts to manufacture. 7. We have considered the submissions of both the sides. It is not in dispute that the impugned goods were bearing the brand name "Thermoking." The defence put forth by the learned Advocate is that 'Thermoking' being not registered with t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hey have not been successful in rebutting those findings before us. Shri Rajesh Kumar, Authorised Representative of M/s. Thermotech, in his statement dated 3-9-98, has clearly deposed that the Appellant No. 1 was getting the work done on job work also till December, 1995 when Thermotech was engaged in manufacturing, they used to sell only goods manufactured by M/s. Thermotech and after closure of manufacture in December, 1995, they purchased goods and sold them under their invoices; there was 5 KVA connection in the factory. This fact has been confirmed by Shri Kul Bhusan who purchased the shed from Mrs. Neera Khanna, by deposing that U.P.S.E.B. had sanctioned and installed 5 KVA power connection and the shed was purchased by him as it is (alongwith 5 KVA power connection). Shri Rajesh was shown some invoices and he deposed that the goods were manufactured by M/s. Thermotech and the invoices were not included in RT 12 Returns. He has admitted to have kept parallel invoices. Shri Subhash Oberai, Accountant, has also deposed in his statement dated 12-10-98 that ledger account taken from CPU contained sales of the goods manufactured and cleared by M/s. Thermotech and many of the sales ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... held in the case of Lauls Ltd., supra. We, therefore, set aside the penalty and remand the matter to the adjudicating authority for considering imposition of penalty under Rule 173Q after following the principles of natural justice. As show cause notice did not contain any charge of imposing penalty on Mrs. Neera Khanna under Rule 209A of the Central Excise Rules, penalty imposed on her is set aside. The penalty under Rule 209A is imposable on Pradeep Khanna as he was looking after the affairs of M/s. Thermotech. This is apparent from the statement dated 3-9-98 of Shri Rajesh Kumar who deposed that the entire work with regard to what goods were to be manufactured and whom they were to be sold to was looked after by Pradeep Khanna. According to the said statement Pradeep Khanna was also looking after appointment of employees, purchase of raw materials and all reports were being submitted to him. Shri Subhash Oberai also deposed in his statement dated 23-9-98 that Pradeep Khanna was the actual controlling person of the affairs of Thermotech. This is further evident from the statement dated 3-7-98 of Shri Pradeep Khanna himself. He appeared before the Excise Officer on behalf of his w ..... 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