Custom, Excise & Service Tax Tribunal
M/S. Mewar Bottling Co. (P) Ltd vs Commissioner Of Central Excise on 14 December, 2016
IN THE CUSTOMS, EXCISE AND SERVICE TAX
APPELLATE TRIBUNAL, NEW DELHI
PRINCIPAL BENCH, COURT NO. I
Excise Appeal No. 1828 & 2359 of 2007
( Arising out of Order-in-Appeal No. 442-443(HKS)CE/JPR-II/2006- dated 28.7.2006/14.8.2006 passed by the Commissioner (Appeals II), Central Excise, Jaipur)
M/s. Mewar Bottling Co. (P) Ltd. Appellant
M/s. Mewar Exim Pvt. Ltd.
Vs.
Commissioner of Central Excise Respondent
Jaipur Appearance:
Shri Rakesh Kumar, Advocate for the Appellants Shri G R Singh, AR for the Respondent CORAM:
Honble Mr. Justice (Dr.) Satish Chandra, President Honble Mr. V. Padmanabhan, Member (Technical) Date of Hearing : 08.12.2016 Date of Decision : 14.12.2016 FINAL ORDER No. 55822-55823 / 2016 Per: V. Padmanabhan:
The present two appeals are directed against the order in appeal dated 28.7.2006 passed by the Commissioner (Appeals0, Jaipur. The appellants were engaged in the manufacture of aerated water falling under Chapter 22 of the Central Excise Tariff. They filed a classification list effective from 1.4.1992 with the Assistant Collector, Central Excise, Udaipur, claiming exemption under small scale industries notification No. 175/1986 dated 1.3.1986 for clearance of aerated waters bearing the brand Citra, The present disputes covers the period 5.4.1992 to 31.5.1992 (Appeal No. E/1828/2007 ) and June, 1993 to November 1993 (Appeal No. E/2359/2007 ). The show cause notice invoking the extended period of limitation in the first case was issued on 16.3.1997 and the second case was issued on 3.1.1994. The Central Excise duty has been demanded for the reason that the goods manufactured have been cleared bearing the brand name Citra which belongs to another company who is not entitled to the small scale industries exemption benefit, in terms of para 7 of Notification No. 175/1986 (para 4 of the succeeding notification No. 1/1993 granting Small Scale Industries benefit). The investigation conducted by the Department revealed that the real ownership and control of the brand was with M/s. Parle Exports Ltd. and not to Limca Flavour and Fragrance Ltd., therefore proceedings were initiated against the appellant. Demands for both the periods stand confirmed by the authorities below which stand challenged in the present appeal.
2. In this background, we have heard Shri Rakesh Kumar, learned Advocate appearing for the appellant and Shri G R Singh, learned DR appearing for the Revenue. Both the appeals are being disposed of by this common order.
3. The orders have been challenged with the arguments that the department at Ahmedabad (where Limca Flavour and Fragrance Ltd., are registered) have passed the order allowing the small scale industries exemption benefit to Limca Flavour and Fragrance Ltd.. Citing this decision, the appellant argues that since Limca Flavour and Fragrance Ltd., are entitled to Small scale industries exemption, there is no contravention of para 7 of notification No. 175/1986 (para 4 of the succeeding notification No. 1/1993).
4. Accordingly, they have submitted that they will be entitled to Small scale industries exemption benefit. In the alternative plea on limitation, they have cited the case law of Nizam Sugar Factory vs. CCE [2006 (197) ELT 465 (SC)] and submitted that a part of the demand will be hit by bar of limitation in the second show cause notice. They have also submitted that since the facts are known to the department, inasmuch as the classification list has been filed in 1992, which has been approved, the entire demand will be hit by time limitation as the department will not be entitled to demand duty invoking the extended period of limitation.
5. The crux of the issue in the present appeals is use of brand name Citra on the aerated water manufactured by the appellant. The claim of small scale industries benefit was originally availed by the appellant by submitting that brand name is owned by M/s. Limca Flavour and Fragrance Ltd., who were entitled to SSI benefit. But the investigation conducted by the department has revealed that the brand name is owned and controlled not by Limca Flavour and Fragrance Ltd., but by M/s. Parle Exports Ltd. who were not entitled to small scale industries exemption benefit. Since the goods have been cleared with the brand name of Citra which is owned by M/s. Parle Exports Ltd. (who are not entitled to SSI benefit), the contravention of conditions specified in para 7 of Notification 175/1986 (para 4 of the succeeding notification No. 1/1993) stand established, disentitling the appellant from SSI benefit.
6. The appellant has seriously argued that the claim is barred by limitation in respect of first show cause notification covering the period 5.4.92 to 31.5.1992, has been issued on 16.3.1997 by invoking the extended period of limitation. We find justification in invoking the extended period of time limit inasmuch as the appellant has failed to reveal who is the real owner of Citra brand name. It is only after the investigation undertaken by the department, it has been revealed that the Citra brand is actually owned by M/s. Parle Exports Ltd. who is not entitled to SSI benefit. Consequently, the invocation of extended time limit is fully justified.
7. Coming to the demand for the period June to November, 1993 for which the show cause notice has been issued on 3.1.1994, we are of the view that decision of Honble Supreme Court in the case of Nizam Sugar Factory (supra) comes to the help of appellant. In the said decision, the Apex Court has held that once a Show cause notice stand issued, issuance of second show cause notice on the same facts could not be taken as suppression of facts on the part of assessee. In respect of second show cause notice, we find that a portion of demand fall beyond the period of normal time limit as prescribed under section 11A at the relevant time. Consequently, the demand in the second show cause notice beyond the period of six months will be hit by time bar. The original adjudicating authority is directed to requantify the demand by excluding the demand beyond the period of six months time. However, demand covered by the first show cause notice is upheld in toto along with consequential relief. We also set aside the penalty imposed under second show cause notice.
8. Both the appeals are disposed of in the above terms.
(pronounced in the open Court 14/12/16).
(Justice (Dr.) Satish Chandra) (V. Padmanabhan)
President Member (Technical)
ss
E/1828, 2359/2007
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