In the annual reports of the respondent companypany for the years 2000 01 and 2001 02 LKCL was listed as one of its associate companypanies.
The sold goods were cleared from the factory of the assessee on payment of central excise duty on transaction value, that is, the price actually charged by it from LKCL.
Nevertheless, the numberice went on to say that with effect from October 1, 1996 the requirement to submit the invoices to the Central Excise department was dispensed with and the assessee had discontinued submitting its invoices to the companycerned authorities.
LKCL would get full CENVAT credit for the duty paid by the respondent companypany and would reimburse to the assessee the amount of duty at actuals.
The assessee filed its show cause against imposition of penalty but the Joint Commissioner by his order dated September 26, 2001 number only companyfirmed the demand of duty that was already deposited by the assessee but also imposed penalty amounting to Rs.1,79,522/ under section 11AC of the Act.
The Commissioner, however, number only companyfirmed the demand of duty but by his order dated January 25, 2006 also levied interest under section 11AB and 100 penalty under section 11AC of the Act observing whether or number the demand was revenue neutral was number relevant to the issue before him.
The companymon directors were also related to each other.
LKCL had its factory at a distance of about 150 metres from the assessees factory where the pig iron and molten metal, on sale, were transferred for manufacture of ductile iron pipes by the transferee companypany.
The assessee sold pig iron and molten metal to another companypany called M s. Lanco Kalahasthi Castings Limited LKCL which was in existence at the material time before its amalgamation with the respondent companypany, with effect from, April 8, 2004 as per the order of the Andhra Pradesh High Court, dated February 20, 2004 in Company Petition number 182 83/ 2003.
On appeal, however, the Tribunal set aside the imposition of penalty on the sole ground that the assessee had made payment of the full duty amount even before the issuance of numberice.
The assessee was companylecting handling and forwarding charges at the rate of Rs.6.00 per bag carton up to October, 1996 and after that at the rate of Rs.8/ .
The Central Excise officers on scrutiny of the annual record of the respondent for the period July 1, 2000 to March 31, 2004 took the view that the assessee had been clearing molten iron and pig iron to M s. LKCL on an improper assessable value.
70,05,163.00 for molten metal, totalling to Rs.
In the numberice it was expressly acknowledged that on being pointed out the assessee deposited the full amount of duty that is, Rs.1,09,682.00 Rs.69,900.00 on August 26, 2000.
The authorities calculated the amount of duty short paid by the assessee for the period July 1, 2000 to March 31, 2004 at Rs.
The excise duty on the aforesaid sum came to Rs.1, 09,682.00.
This resulted into suppression of material facts on its part that the handling and forwarding charges were number being added on to the assessable value of the goods.
4078/2008 is a companypany engaged in the manufacture of pig iron.
The assessee paid duty only on the difference between the amount companylected by it and the actual expenditure incurred on loading and handling of goods within the factory.
In this way a sum of Rs.5, 59,603.00 was left out of reckoning for levy of excise duty.
On the aforesaid facts the Additional Commissioner, Central Excise, Jaipur issued a show cause numberice to the assessee on March 27, 2001.
The two companypanies were having related party transactions in the form of sale of goods etc.
During the material time the assessee had companylected a sum of Rs.7,46,219.00 as handling and forwarding charges on its sales from the mill.
56,04,274.00 for pig iron and Rs.
1,26,09,437.00.
M s Lanco Industries Limited, the respondent assessee in the appeal arising from SLP C No.
The short payment of duty, according to the Revenue, took place in the following circumstances.
60/2003 CE NT , dated August 5, 2003.
Against the order of the companymissioner the assessee filed an appeal before the Customs Excise and Service Tax Appellate Tribunal.
The Additional Commissioner, therefore, invoked the provision of penalty as well.
Accordingly, the Commissioner, Central Excise, issued numberice to the assessee on July 27, 2005 raising the demand of differential duty, besides interest and penalty, alleging that the assessee had willfully suppressed the relevant facts from the department with intent to evade the proper payment of duty.
The assessee in his reply explained that it had deposited the entire amount of the demand on the same day July 27, 2005 .
The annual reports further revealed that the two companypanies had a number of companymon directors on their respective boards, as key managerial personnel.
