RADHA MADHAV ENGINEERING Vs. COMMISSIONER OF CENTRAL

JUDGEMENT

(1.) THESE appeals have been filed against Order -in -original No. 9/2003 -C. Ex. dated 20.2.2004 dated passed by the Commissioner of Central Excise, Hyderabad -II Commissionerate, Hyderabad.

(2.) THE appellants are the manufacturers of Radial Crust Gates with Rope Drum Hoist, Vertical Gate with Rope Drum Hoist, Gantry Cranes, E.O.T Cranes, Hydraulic Hoists, Expansion Joints and Bulk Heads. The Excise officers conducted certain investigations and based on them Show Cause Notice dated 4.5.2000 was issued alleging that the appellants manufactured excisable goods prior to 1994 -95 without obtaining Central Excise Registration. Only in 1997 the appellants obtained Excise Registration after the Orissa Construction Corporation Limited had insisted for the same. The appellants failed to declare the value of clearances made prior to 1994 -95 and upto 1997. The appellants evaded duty by creating documents in the name of Prefab Gratings Limited (PGL) and Hariwood Industries. In order to avail SSI exemption the appellants floated a dummy unit by name PGL and another unit by name and style of Hariwood Industries for undertaking the job work of fabricating engineering pertaining to the goods of RMEE and PGL, which are within the exemption limits. All the three units, namely M/s. Radha Madhava Engineering Enterprises (P) Ltd. M/s. Prefab Gratings Limited and Hariwood Industries fall within the definition of related person as defined under Section 4(4) of the Central Excise Act 1944. The value of clearances suppressed from period from 1995 -96 to 1988 -1989 is Rs. 15,59,89,680/ - on which the duty liability works out to Rs. 1,70,16,623/ -. Based on the above allegations, Show Cause Notice was issued to the appellants. After adjudication the Commissioner of Customs and Central Excise demanded the duty of Rs. 15,91,720/ - on the amount of Rs. 1,22,44,000/ - received by the appellants from Buggavanka Project in terms of proviso to Sub -section (1) of Section 11A of the Central Excise Act, 1944. Interest under Section 11AB was demanded. Mandatory penalty under Section 11AC was imposed. The plant and machinery were confiscated in terms of Rule 173Q(d)(2). A redemption fine of Rs. 5 lakh was imposed. A penalty of Rs. 15,000/ - each on the following was imposed under Rule 290A of the Central Excise Rules, 1944.

(3.) SHRI B.V. Kumar, Advocate appeared for the appellant and Shri Ganesh Havanur, SDR for the Revenue. The learned advocate made the following submissions.