M/S. Mukat Pipes Ltd vs Commissioner Of Central Excise

[Arising out of Order-In-Original No. 24-25/CE/CHD/06 dated 16.6.2006 passed by Commissioner of Central Excise, Chandigarh. ]

For approval and signature:

Honble Mr Ashok Jindal, Member (Judicial)

Hon'ble Mr. B Ravichandran , Member (Technical)

1 Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?

2 Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?

3 Whether Their Lordships wish to see the fair copy of the Order?

4 Whether Order is to be circulated to the Departmental authorities?

M/s. Mukat Pipes Ltd. Appellants

Surindra Engg Co. Ltd.

Vs.

Commissioner of Central Excise Respondent

Chandigarh

Appearance:

Shri K K Anand, Advocate for the Appellants

Shri Ranjan Khanna, DR for the Respondent

CORAM:

Hon'ble Shri Ashok Jindal, Member (Judicial)

Hon'ble Mr. B Ravichandran, Member (Technical)

Date of Hearing /decision: 09.09.2015

FINAL ORDER NO. A/ 52968-52969/2015-EX(DB)

Per Ashok Jindal :

Appellants are in appeals against the impugned order confirming the demand of duty of Rs.62,02,285/- along with interest and equal amount of penalty and imposing penalty on appellant No. 2 i.e. M/s. Surindra Engg. Co. Ltd. of Rs.6 lakh and redemption fine of Rs.25 lakh.

2. The facts of the case are that the appellant No. 1 is the manufacturer of MS pipes and located at Rajpura i.e. they are supplying pipes to appellant No. 2 on payment of duty. During the course of investigation, it was revealed that both the appellants have mutual interest of business of each other. Therefore, they are related person and in that circumstances, what are the additional consideration received by the appellant No. 2 is required to be added in the assessable value. In these set of facts, the show cause notice was issued to both the appellants. Matter was adjudicated and demand on account of additional consideration received by appellant No.1 were confirmed along with interest and penalties on both the appellants were imposed. The said order was challenged before this Tribunal and this Tribunal already held that both are related person as the appellant No. 2 is engaged in the execution of work against work order of certain contract given by statutory authority for laying the pipes. In that situation, this Tribunal remanded the matter back vide order dated 26.10.2004 directing the appellant to produce the documents for admissible deduction to arrive at correct assessable value i.e. cost of transportation of octroi and post manufacturing expenses such as loading, unloading charges incurred by appellant no. 2. In remand proceedings, the appellant produced the Cost Accountants certificate certifying that after clearance of the goods from the premises of appellant No.1, certain expenses have been incurred of appellant No. 2 which was admissible deductions to arrive at correct assessable value. The adjudicating authority in the impugned order rejected the certificate in the absence of documents produced by the appellant and passed the impugned order. Aggrieved from the said order, appellant is before us.

3. Heard the parties. Considered the submissions.

4. After hearing the parties, we find that in this case in this Tribunal has given direction vide order dated 26.10.04 to provide details of admissible deductions to arrive at correct assessable value to the appellant and in compliance to that direction, appellant produced Cost Accountants certificate which certified certain admissible deductions to arrive at correct assessable value. But the adjudicating authority have not considered the said certificate and only asked the financial records to be produced before him which appellant replied that they are not having that particular records and all records being voluminous, belongs to the appellant No. 2 who is located in Mumbai and requested the adjudicating authority to depute some officer to inspect the said record at the cost of the appellant to verify the Cost Accountants certificate along with this record to arrive at a correct assessable value but the request of the appellant was not entertained by the adjudicating authority and impugned order is passed. In the interest of justice, as records were voluminous and to verify the Cost Accountants certificate, the adjudicating authority was required to depute some officer to visit the premises of appellant No. 2 and to verify the genuineness of the certificate issued by Cost Accountant and thereafter to arrive at the correct assessable value, which has not been done in this case. Therefore, we set aside the impugned order and remand the matter back to the adjudicating authority to consider the certificate issued by the Cost Accountant certifying the correct assessable value if the adjudicating authority feels nothing genuine in the certificate of Cost Accountant, in that case the adjudicating authority, if desires, depute some Cost Accountant or some other officer to verify the records of appellant No..2 to arrive at correct assessable value at the cost of the Appellant.

5. In these circumstances, we remand the matter back to the adjudicating authority to arrive at a correct assessable value as discussed above and thereafter pass an appropriate order in accordance with the law. It is pertinent to mention that adjudicating authority shall give an opportunity of being heard to the appellant to defend their case.

6. The appeals are disposed of in the above manner.

( Dictated and pronounced in the open court )

( Ashok Jindal ) Member(Judicial)

( B Ravichandran )

Member(Technical)

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