GABRIEL JOHN Vs. COMMISSIONER OF CENTRAL EXCISE

JUDGEMENT

(1.) ALL these appeals arise from common Order -in -Original No. 16/90 dated 16.11.90 by which the Commissioner has ordered for clubbing of clearances of all the above units and to treat them as one and as a consequence has denied the benefit of SSI exemption in termsof para 4 (a) and Para 4 (b) of Notification No. 175/86. Thereby, duty demand of Rs. 16,89,398.36 has been confirmed on Smt. Madana in respect of the entire fireworks manufactured and cleared from M/s. Mercury Fireworks, M/s. Sri Bannari Amman Fireworks, Universal Fireworks and Saraswathi Fireworks, under Rule 9(2) read with proviso to Section 11A(1) of the Central Excise and Salt Act, 1944. A further demand of Rs. 7,240.38 has been confirmed on fireworks found short during the officer's visit on 19.9.89 in all the four factories under Rule 9(2) read with proviso to Section 11A(1) of the Central Excise and Salt Act, 1944. There are separate penalties also imposed: Rs. 1,00,000 on Smt. Madana under Rule 173Q of CE Rules and Rs. 5000 each on M/s. Mercury Fireworks, M/s. Sri. Bannari Amman Fireworks, M/s. Universal Fireworks and M/s. Saraswathi Fireworks under Rule 173Q of the CE Rules. Also, there is penalty of Rs. 1000 each of the persons indicated in the order under Rule 209 -A of the CE Rules, who are said to be the partners of respective firms. A penalty of Rs. 1,00,000 has also been imposed on A. Ramamurthi under Rule 209 -A. Besides, penalty of Rs. 1000 on Shri A. Abdul Kareem of Mercury Traders under Rule 209 -A of CE Rules; Rs. 5000 each on Shri R. Mohan, Order Processing cum Despatch Clerk and Shri P. Gaberial John, General Manager of Ramamurthi Group of companies under Rule 209 -A have also been imposed. Further penalty has been imposed on A. Bhaskaran, K. Sankaraj, M. Kanakaraj, K. Venugopal, D. Rajendran under Rule 209 -A of the Act. The department's allegation against these appellants are that Smt. Madana and Shri A. Ramamurthi by wilful consent and collusion with intent to evade payment of duty have - -

(2.)

(3.) AND whereas, as per para 4 of Notification No. 175/86, exemption contained in Notifications No. 175/86 shall be applicable only to a factory which is an undertaking registered with the Director of Industries as a small scale industry under the provisions of Industries (Development and Regulations) Act, 1951, provided that the value of clearances from a factory during the preceding financial year or in the current financial year did not exceed or is not likely to exceed Rs. 7.5 lakhs.