KWALITY FUN FOODS AND RESTAURANT Vs. CCE

JUDGEMENT

(1.) All these three appeals arise from a common Order -in -Original No. 37/2001 (Commr.) dated 28.9.2001 by which the learned Commissioner has confirmed the duty demand and imposition of penalties in respect of appellants on the ground that all the three parties are related persons and their clearances are required to be clubbed. He upheld the charge of suppression of facts. The appellants were served with three show cause notices dated 9.5.1996, 3.7.2000 and 1.3.2001 alleging that M/s. Kwality Fun Foods Restaurant (P) Ltd., (herein after referred to as M/s. KFRL) have contravened the provisions of Rule 9(1) and Rule 173Q read with Section 4 of the Central Excise Act inasmuch as that they had cleared Ice creams to M/s. Hindustan Lever Ltd., Chennai, Kerala and Bangalore (earlier named as M/s. Brooke Bond Liptons India Ltd.) (herein after referred to as M/s. HLL) with the brand name "Kwality Walls" and the assessable value adopted by them appeared to be not at arm's length, the transactions between them could not be considered as to be principal to principal basis and in the course of normal wholesale trade.

(2.) The allegations were made on the following considerations:

(3.) In view of the above, it was alleged that the price should not be considered as a price of sole consideration for the sale. It was also alleged that the transaction between them are not on principal to principal basis. The whole sale market exists only at the hand of M/s. HLL who has managerial control and control over the products, and hence the differential duty is recoverable from them. The above allegations were made in the show cause notice dated 1.3.2001.