SHEFFIELD APPLIANCES, POLAR Vs. CCE

JUDGEMENT

(1.) THESE appeals are directed against a common order. Accordingly, they were taken up for hearing together and are disposed of under this common order.

(2.) THE appellants Polar Fan Industries Ltd., Polar Industries Ltd. and Sheffield Appliances are manufacturers of fan. Their entire production is sold to Polar International Ltd., who in turn sells the fans to dealers. All these appellants are Public Limited Companies. The remaining appellants are Officers of these Limited Companies. The impugned order has held that the manufacturing companies and the marketing company are related persons and therefore, the assessable value for Central Excise duty purposes should be the sale price of the marketing company and not the sale price of the manufacturing company to the marketing companies Proviso (iii) to Section 4(1)(a) of the Central Excise Act. However, the assessees paid duty at the time of clearance, taking the sale price to the marketing company as the assessable value. The impugned order has, therefore, reassessed the goods, taking the sale price of the marketing company as the assessable value and has demanded differential duty from the manufacturing companies. Penalties equivalent to the duty evaded have also been imposed. Full details of duty demand, penalty etc. are available in the table below: <FRM>JUDGEMENT_239_LAWS(CE)3_2003.htm</FRM>

(3.) THE appeals contest the duty demand an penalties both on merits as well as on the ground of limitation. It is their contention that most of the demand is time barred as the Show Cause Notice dt. 2.8.99 was issued well beyond the normal period for such notice provided in Section 11A of the Central Excise Act. They also submit that proviso to this Section, which permits of demand for five years, is not attracted as there was not wilful suppression or misstatement of facts, in order to justify duty demand beyond the normal period.