INTEGRAL POWER PACKS Vs. COMMISSIONER OF CENTRAL EXCISE

JUDGEMENT

(1.) This appeal by the assessee is directed against the order passed by the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), South Zonal Bench, Chennai, in Appeal No.E/00464/2010, dated 03.11.2017. This appeal has been filed raising the following substantial questions of law:

(2.) The respondent Department issued a show cause notice to the appellant assessee dated 09.08.2000 inter alia alleging that the assessee has contravened the provisions of Central Excise Rules inasmuch as they have manufactured and cleared the excisable goods with brand name 'Cansoft', which belongs to another manufacturer, without payment of excise duty and without following excise procedures. The facts of the case were furnished in the form to an annexure to the show cause notice. The assessee was directed to show cause as to why the proviso to Section 11A of the Central Excise Act, 1944 (hereinafter referred to as "the Act") should not be invoked in their case to demand duty; why duty of Rs. 14,30,991/- should not be demanded; why penalty should not be imposed under Section 11AC of the Act as well as under Rule 173Q of the Central Excise Rules, 1944 (hereinafter referred to as "Rules"); why interest should not be demanded under Section 11AB of the Act and why the seized goods should not be confiscated under Section 110 of the Customs Act made applicable to the Central Excise Act.

(3.) The assessee filed their reply dated 05.02001 stating that they had not manufactured the said goods namely, offline UPS with brand name of another person as alleged in the show cause notice and that there is no mention in the show cause notice that any other manufacturer has manufactured offline UPS with this indication Cansoft Tiny etc. and that if a brand name is registered for a particular product, another manufacturer can use it for another product that they had manufactured and supplied offline UPS with Cansoft Gold etc. to M/s. Cansoft Systems Private Limited with effect from 1996 and if anybody else use this brand name, they have to be considered as manufacturers of goods bearing the brand name of others. Thus, it was contended that burden of proof lies on the Department, which has not been discharged and therefore, the show cause notice is not sustainable in law. Further, it was stated that investigation has been done only on the ground that M/s. Cansoft Systems stated that they have engaged in trading activities only and therefore, onus is on the Department to establish the allegations in the show cause notice. After referring to certain decisions in support of their contentions, the assessee stated that the demand made in the show cause notice is barred by time, as they had not suppressed any information with intent to evade payment of duty, even if at all there has been any omission, it was without any malafide intention. Accordingly, the assessee prayed for dropping the proceedings initiated against them and also release the goods, which were seized.