1. Both these appeals arise from a common Order-in-Original No. 3/2001, dated 31-8-2001 by which the Commissioner of Central Excise, Chennai has confirmed the demands raised in the show cause notice against Meera Industries to an extent indicated in the impugned order for the demands raised for the years 1995-96 to 2000-2001 in terms of Section 11A(2) of CE Act. A penalty under Section 11AC of the CE Act has also been imposed on the ground that the offence has been committed by them from 28-9-96 onwards. A penalty under Rule 173Q has also been imposed on Meera Industries for the offences committed by them till 27-9-96. A personal penalty of Rs. 2.00 lakhs has been imposed on Shri K.R.Balachandran, Partner of both Meera Industries and Rama Industries under Rule 209A of CE Rules. The seized goods were confiscated under Rules 173Q and released on payment of redemption fine of Rs. 4.4 lakhs, bank guarantee of Rs. 3.62 lakhs have been encashed and appropriated towards the redemption fine of confiscated goods. Plant and machinery have also been directed to be confiscated in respect of Meera Industries and Rama Industries under Rule 173Q and 209 of CE Rules.
However, granting the appellant to redeem the same on payment of fine of Rs. 1 lakh. The allegation against the appellant is that they are manufacturers of the products of pressure pans, pressure cookers registered with the Central Excise department and were availing the benefit of SSI exemption under the said notification. They were fixing brand name "SEETHA". The firm comprised of partners of Mr. K.R.Balachandran and Mrs. B. Kousika w/o of Mr. K.R. Balachandran.
2. M/s. Rama Industries, another firm, which according to the appellant is an independent firm with separate constituents of partners comprising of Mr. K.R. Babu and Mrs. B. Nithya, w/o. Mr. K.R. Babu registered with the Central Excise department and manufacturing pans, pressure cookers with brand name of "RAMA" and availing benefit under SSI notification.
3. Two show cause notices were issued on 28-12-99 and 12-6-2000 for alleged offences committed by M/s. Meera Industries during the period, 1995 - 96 to 1999-2000 invoking proviso to Section 11A(1) of CE Act.
4. In the first show cause notice dated 28-12-99 they were asked to show cause as to why :- (i) the goods valued at Rs. 44,06,765/- (as listed in the Annexure to Mahazar) seized on 1-7-99 and 3-7-99 at the factory premises which is subsequently released provisionally, should not be confiscated under Rule 173Q of Central Excise Rules, 1944 ; (ii) in case, if the seized provisionally released goods could not be produced before the adjudicating authority why an amount of Rs. 3,62,806/- towards duty on the said goods should not be demanded under Rule 9 (2) of Central Excise Rules, 1944; (iii) why a penalty should not be imposed on them under Rule 173Q ibid read with Section 11AC of Central Excise Act, 1944 for the above said violations; and (iv) why penalty should not be imposed on Shri K.R. Balachandran, Partner of M/s. Meera Industries under Rule 209A.5. In the second show cause notice dated 12-6-2000, the Noticees were asked to show cause as to why : - (i) the duty amount of Rs. 34,93,670/- (Rupees thirty four lakhs ninety three thousand six hundreds seventy only) as listed in the Annexure B to the notice should not be demanded in terms of Rule 9(2) of Central Excise Rules, 1944 read with proviso to subsection (1) of Section 11A of Central Excise Act, 1944; (ii) a penalty equivalent to the duty should not be imposed under Section 11AC of Central Excise Act, 1944 for the above said contravention; (iii) interest for delayed payment of excise duty should not be levied under Section 11AB of Central Excise Act, 1944; (iv) penalty should not be imposed under Rule 173Q of Central Excise Rules, 1944 for the contravention as stated supra; and (v) penalty should not be imposed on Shri K.R. Balachandran partner of M/s. Meera Industries, under Rule 209A of Central Excise Rules, 1944.
6. As the products Pressure Cookers and LPG stoves are products falling under Section 4A for determination of value in terms of Notifications 18/98 C.E. (N.T.) dated 2-6-98 and 20/99 C.E. (NT.) dated 28-2-99 an addendum dated 17-2-2001 to the Show Cause Notice dated 12-6-2000 was served on the Noticees on 7-3-2001 demanding a differential duty of Rs. 2,86,156/-arisen due to the valuation to be made under Section 4A.7. The facts of the case are set out in detail in the two show cause notices and it will be superfluous to repeat them all over again.
However, the facts and allegations of the two show cause notices, in brief are as follows :- (i) On a thorough search conducted at the premises of Meera Industries on 1-7-1999 and 3-7-1999, it was found that no Central Excise records were available in the factory for verification; (ii) It was informed that another company name, Rama Industries was also manufacturing excisable goods within the said premises; (iii) the stock of excisable goods valued at Rs. 5,09,670/- available could not be correlated as no Central Excise records were available in the factory and hence, the stocks were detained; (iv) Some of the rooms were locked and no keys were available with the staff of the Unit and hence those rooms were sealed.
(v) On the same day (1-7-1999), another group of officers visited the registered office of the Unit at Mylapore, Chennai-4 where Shri K. Balachandran, Partner of Meera Industries was present. He also did not produce Central Excise records for the stock of excisable goods found at the factory premises; (vi) Shri K. Balachandran, provided the keys for the locked and sealed rooms on 3-7-99 and on opening, finished excisable goods valued at Rs. 38,97,095/- were found and again, no Central Excise records were available/produced to correlate the stock of goods.
Hence, the goods were seized on 3-7-1999 for further investigations.
(vii) On the request of Meera Industries, the goods seized both on 1-7-99 and 3-7-99 were subsequently released provisionally; (viii) The Central Excise Officers at Banglore, Hyderabad and Vijayawada searched the premises connected with Meera Industries and Rama Industries including M/s. Rama Home Needs (P) Ltd., which is a trading company and in which Shri K.R. Balachandran is the Managing Director; (ix) In his statement dated 1-7-99 Shri R. Sounder, Assistant Supervisor of Meera Industries stated that that their unit is manufacturing pressure cooker with 'RAMA' Brand; that he is aware that Rama Industries is functioning in the same premises manufacturing Gas stoves with 'RAMA' and 'SEETHA' Brands; that they are not maintaining any attendance register and the workers are common for both Meera Industries and Rama Industries; to a specific query as to what are all the places marked for Rama Industries and Meera Industries, he stated that he had no idea as there was no separate demarcation for Rama Industries and Meera Industries; (x) In his statement Shri SVRM Rao, Proprietor of M/s. Karthik Enterprises, Vijayawada who is also in charge of Rama Home Needs (P) Ltd., Vijayawada has stated that they received 'RAMA' brand water filters filter, candles, Gas tubes, Casseroles, Cookers, etc., from both Rama Industries and Meera Industries; (xi) In his statement dated 18-8-99 Shri S.A. Hussain, Accounts Manager, M/s. Associated Marketing, has stated that M/s. Rama Home Needs (P) Ltd., Chennai have supplied them Aluminium Pressure cookers, LPG Stoves with Rama brand; that M/s. Rama Home Needs P. Ltd. have supplied Aluminium Pressure pan but have billed them as Aluminium Frying Pan and lid for frying pan, that M/s. Associated Marketing Agencies sold the same as 'Pressure Pan'; that at no point of time they sold the frying pan and lid separately and that they were the distributors of M/s. Rama Home Needs P. Ltd.; and has stated further in his letter dated 19-8-99 that the Frying pan and lid had come in a single carton; (xii) Dealers from various places have also stated that they have received 'Seetha' brand LPG stoves from Rama Industries; that, 'Rama' range of products from both Meera Industries and Rama Industries; (xiii) The registers/documents requested from Seetha Industries were submitted by them in piecemeal and that too mostly in photocopies.
The final set of documents were handed over by them on 10-12-99 only, after prolonged and repeated requests; (xiv) Shri K.R. Balachandran, after recording the statement, produced RG 1 Register for the years 1998-99 and 1999-2000 as well as RT 12 returns for the years 1998-99 and 1999-2000. Perusal of RG 1 register appeared to reveal that they are neither authenticated nor inspected by any Central Excise officer. Further perusal of RT 12 returns produced clearly shows that they were not submitted to Range Officer, as they did not bear the acknowledgement of the Range Officer.
(xv) Statement from Shri K. Sankar, Partner of M/s. Balaji Graphics, Thiruvanmiyur, Chennai was recorded on 22-10-99. He has stated therein that they have been supplying metal labels to Rama Industries for the last four years; previously, they had supplied the same metal labels to Meera Industries also; for the supplies of labels made they received payments from Rama Industries; (xvi) The statement of Mr. R. Sounder and Mr. M. Manoj, employees of Meera Industries appear to reveal that there is only one factory; it is strengthened by their admission that they could not demarcate Meera Industries from Rama Industries.
(xvii) It is also admitted by them that both 'Rama' and 'Seetha' brand Cookers and LPG stoves are manufactured in the same factory premises.
(xviii) That there exists only one factory manufacturing Cookers and LPG Stoves of 'Rama' and 'Seetha' brands. "Rama" brand goods are also manufactured by Meera Industries and cleared from their factory, where as on records it has been shown that the raw materials are procured by Rama Industries, No. 5, Nynar Nadar Road, Mylapore, Chennai-4, and sent to the non-existing Rama Industries at 146, East Coast Road. Injambakkam, Chennai-41. It appeared, the raw materials are actually received and goods are manufactured and removed by Meera Industries in the name of Rama Industries. This became possible as both Meera Industries and Rama Industries are closely controlled by Shri K.R. Bala-chandran and his family members.
8. Meera Industries filed their reply for the first show cause notice dated 28-12-1999 vide their letter No. MI/EXC/5/2000, dated 9-3-2000 wherein they have stated - (i) that Meera Industries are engaged in the manufacture of only Pressure Cooker and Frying Pan under the brand name of "Rama" and "Sheetha"; (ii) that the brand name of "Seetha" is registered in the name of Meera Industries while the brand name 'Rama' is not registered, use of brand name 'Rama' was started only from 1998; (iii) that Rama Industries is another registered partnership firm and LPG Stoves are manufactured by them with the brand name 'Rama'; (iv) that Rama Industries is functioning at the same portion of No. 146, East Coast Road, Injambakkam, Chennai - 600 041 which property belonged to Meera Industries who have given it on rent to Rama Industries; (v) that the allegation that Meera Industries is engaged in the manufacture of all items is factually wrong and established by the following Separate set of employees (as they covered by ESI, PF and Factories Act interchanging of workers is impossible) (vi) that from the above the companies are existing, functioning and running independently and therefore clubbing the value of clearances of both companies is not sustainable for which they relied on number of judgments which are as follows:-Padma Packages (P) Ltd. v. Collector of Central Excise, CoimbatoreNaresh Shroff of Prop. Uni-Offset Printers v. Commissioner of C. Ex., Madras (c) Collector of Central Excise, Jaipur v. Rock Drill (1) Pvt. Ltd. - 1997 (95) E.L.T. 93 (Tri.);Commissioner of Central Excise, Goa v. Pramila Sanitary Products Pvt. Ltd. (e) Shiv Sons & Hira sons v. Collector of Central Excise, Kanpnr - 1998 (101) E.L.T. 695 (Tri.);Commissioner of Central Excise, Bombay v. Libra Industries - 1999 (107) E.LT. 348 (Tri.);Commissioner of Central Excise, Bangalore v. Japan Mannequin Co.
- 1999 (108) E.LT. 138 (Tri.); (h) Indian Metal Industries v. Commissioner of Central Excise, Bhubaneshwar - 1999 (108) E.LT. 593 (Tri.); (i) Vir Industries v. Collector of Central Excise, Bombay I - 1999 (109) E.LT. 322 (Tri.); (j) Vasavi Industries v. Collector of Central Excise, Hyderabad -1999 (109) E.LT. 908 (Tri.).
(vii) that as product range, partner, premises, electricity, excise registration, ST, IT, Factories Act, PF, ESI are different clubbing the value of clearances of both the units is legally not sustainable and therefore the proposal contemplated to confiscate the goods of both the companies are ultra vires the provisions of law.
(viii) that LPG Stoves are manufactured by Rama Industries under the name of 'Rama' whereas Pressure Cookers and Frying Pans are manufactured by Meera Industries under the brand names 'Rama' and 'Seetha'. On the brand name issue they cited the following further case laws.
(a) Collector of C. Ex., Bombay v. Srinagar Cosmetics Private Limited - 1988 (35) E.LT. 581 (Tri.); (b) Rukmani Pakkwell Traders v. Commissioner of Central Excise, Tricky - 1999 (109) E.LT. 204 (Tri.);Suvik Electronics Private Ltd. v. Commissioner of Central Excise, AhemadabadSri Ganga Nagar Bottling Company v. Commissioner of Central Excise, JaipurCommissioner of Central Excise, Meerut v. Gopal Soap Industries - 1999 (111) E.L.T. 876 (Tri.); (ix) that to the absence of statutory records, they were kept under lock and key and therefore could not be produced to the Officers; but subsequently produced by them; (x) that Shri R. Soundar and Shri M. Manoj are relatively new and not qualified and competent enough to answer the queries; (xi) that all the brand names and all the products are mentioned in the advertisements and product literature is ill-conceived and such mention in literature under the invoice, advertisement, etc., has no relevance; (xii) that the Frying Pan manufactured by them was not capable of functioning as Pressure Cooker; (xiii) that the Seizure is illegal and therefore the questions of confiscation and mandatory penalty under Section 11AC of Central Excise Act, 1944 and Rule 173Q of Central Excise Rules, 1944 do not arise at all; 9. In their reply dated 18-8-2000 to the second show cause notice No.V/15/34/2000 - CX.ADJ III, dated 12-6-2000 filed for Meera Industries as well as for Mr. K.R. Balachandran, they have stated - (i) that Rama Industries manufactured only LPG Stoves and other items in question like Pressure cooker, Frying Pans, Water Filters, etc., were never manufactured by them; (ii) that Meera Industries manufactured 'Seetha' brand Cookers and Water Filters. Therefore, the products manufactured by Meera Industries and Rama Industries are totally different; (iii) that the Officers failed to understand that there existed a rental agreement between the two companies; (iv) that there are correspondences with the two Companies by the Department during earlier years and from that it could be seen that the Units were individually existing and had been frequently visited, inspected and controlled by various statutory authorities; (v) that following further case laws support their contention against clubbing of value of clearances.
(a) Accurate Engg. Co. Private ltd. v. CCE, Pune - 1999 (112) E.L.T. 679 (Tri.);CCE, Rajkot v. Amar Plast Industries - 2000 (115) E.L.T. 482 (Tri.); (c) Chemguard Coatings Private Ltd. v. CCE, Chennai - 2000 (116) E.L.T. 43 (Tri.);Deep Jyote Paints Industries v. CCE, Bombay - 2000 (117) E.L.T. 223 (Tri.);Jalla Industries v. CCE, Mumbai II - 2000 (117) E.L.T. 429 (Tri.); (f) Primlaks Waffles Pvt. Ltd. v. CCE, Pune - 2000 (118) E.L.T. 221 (Tri.);CCE, New Delhi v. Standard Watch Co. (P) Ltd. - 2000 (119) E.L.T. 703 (Tri.).
(vi) and that the allegations made in the show cause notice are not sustainable and time-barred as established in various cases like Chemphar Drugs & Linaments and Padmini Products as well as Tamil Nadu Housing Board.
10. The Commissioner after due consideration of the submissions in the reply to the show cause notices and on submissions made before him rejected the pleas including large number of judgments cited by the appellant. He has concluded in his order as follows : (a) that there existed no two separate manufacturing activities but all manufacturing activities were done by M/s. Meera Industries only and bills and transactions were created as if there were two manufacturing-facility-owned-firms.
(b) He has relied the deposition of Shri K. Sankar of Balaji Graphics who deposed that he supplied labels to both "Seetha" and "Rama" and received payments on those label supplies from Rama Industries. He has noted that such honouring of one firm's bills by another firm clearly shows cross-funding. He noted that many buyers of products have confirmed the inter-changing of supplies and bills between two firms and therefore he proves that there is financial flow back and cross-funding.
(c) He has noted that M/s. Meera Industries has become liable not because of common partners between two firms but basically because the other firm did not exist on manufacturing goods in reality. It was M/s. Meera Industries who manufactured goods appearing with brand name "Seetha".
(d) He also held that mutuality of interest between two firms and cross-funding of flow back are proved in this case by investigation taken up from the bills which is of Meera Industries.
(e) He has also noted that all the production of Rama Industries were made by Meera Industries only and no clubbing of production of two units is involved and that the financial accommodation between the two firms is well established and that the case is not one of production made by Rama Industries to be clubbed with that of Meera Industries. He has held that the Department has not taken the case of clubbing of two separate units clearances and on this ground he has distinguished large number of judgments cited before him. He has held that financial flow back between Meera Industries and Rama Industries is proved and the SSI exemption notification specifically bars use of other brand name while availing duty exemption.
(f) In para 17 of the order the Commissioner has also noted that it is an admitted fact that the brand name of 'Seetha' belong to Meera Industries and the brand name of "Rama" belong to Rama Industries.
He has held that the activity of manufacture of all goods in effect was done by Meera Industries and all the goods, whether it bore the brand name 'Seetha' or 'Rama' were in fact manufactured by Meera Industries only. Therefore the effect of this fact is that Meera Industries manufactured excisable goods bearing the brand name of another firm and as such the benefit of the SSI exemption notification is not available to the appellant.
(g) The Commissioner has distinguished large number of judgments cited by the appellant to support their plea that each firm was different from the other and there was no use in the brand name of the other. He has also rejected the defence that Rama Industries manufactured domestic LPG stoves and Meera Industries manufactured branded cookers and water filters and they relied on large number of judgments which was also rejected.
(h) Ld. Commissioner also did not accept the plea that Rama Industries was in existence and was functioning independently by manufacturing separate goods. He also rejected the plea that Rama Industries was visited by the officers and there were proceedings earlier initiated by the department and the department was aware of their existence. He also rejected the plea about the use of filing separate RT 12 returns which were accepted by the department and that they were paying duty. He also rejected their plea as the department was aware of the facts and larger period was not invokable. He has distinguished large number of judgments cited on this account and has not accepted the pleas raised by the appellant.
(i) He has noted in Para 18.7 that the case in hand is not a case of mere failure on the part of Meera Industries in not paying duty but it is a well planned and orchestrated act on the part of the partners of both Meera Industries and Rama Industries in evading the duty due. This schemed to float a firm on paper by name Rama Industries, misdeclared it to be a manufacturing firm, suppressed the fact of manufacture of all goods by Meera Industries and they wanted to promote both 'Seetha' and 'Rama' brand names by defeating the law, that is, the SSI exemption notification by cornering unintended duty exemption. He has noted that the buyers of Meera Industries have also gone on record stating that they used to receive the goods both under the Meera Industries and Rama Industries bill heads showed the cross-funding between the two firms. He has noted that such planned evasion with an intent of Meera Industries to evade payment of duty is proved. On account of this reason he has confirmed the duty demand and has also imposed penalties and has also confiscated the plant and machinery and granted redemption on payment of fine.
11. We have heard ld. Counsel Shri P.S. Raman, Adv. for the appellants and Shri A. Jayachandran, DR, for the respondent. 12. Ld. Counsel produced enormous evidence furnished in the paper book. He pointed out that both the units had registered with the department including separate registration, declaration and RT 12 returns from time to time.
He also pointed out that Rama Industries was in existence from 1990 onwards and were paying duty and also filing income-tax and sales tax returns. They were having separate balance sheets and there was no flow back of funds. The statement given by the buyers could not lead to a conclusion that there was flow back or mis-utilization of brand names either of them. He contended very strongly that the department has failed to issue show cause notice to Rama Industries and without notices to Rama Industries their clearances cannot be clubbed with the clearances of Meera Industries. It is his contention that it is a well settled law that when the department wants to hold the other unit as a dummy unit or to hold that the said unit is on paper or that there is flow back of funds then it was mandatory to issue show cause notice to the other unit namely Rama Industries. Violation of issue of show cause notice and proceeding to club clearances of the other unit is bad in law and on that account the proceedings are required to be quashed. He relied on the following judgment :Dawn Fire Works v. CCE 13. Ld. DR merely relied on the para-wise comments filed by the department except to state that the comments filed by the department be read and he had nothing more to submit or argue.
14. We have carefully considered the submissions made by both the sides and have perused the enormous paper book and the defence filed by the appellant. The main case against the appellant is that they were manufacturing pressure pans, pressure cookers with the brand name of "Seetha". That they were using the brand name of Rama Industries and thus they were ineligible for SSI exemption and as a consequence the demands have been raised to club the clearances of both Meera Industries and Rama Industries and demands the same from Meera Industries. On perusal of the entire records we notice from the paper book that both the units were independently functioning. Rama Industries was in existence from 1990 and the Department had acknowledged the RT 12 returns, and even had inspected the premises of both the units which were located separately. Both the units had been filing income-tax returns and also sales tax returns and maintained separate registers under various legislations. They had separate plan and factory plan which have been approved. The said plan had been filing with the department and the department had acknowledged the receipt of the same. There is a rental agreement in respect of both the units. They had been having separate profit and loss accounts and separate dealings. Goods manufactured by both the units are different and have different brand names. Further we notice from the records that Rama Industries was issued with a letter dated 20-8-90 by Superintendent of Central Excise, Range III 'C'. Madras-Ill Division directing them to file the details pertaining to SSI certificate and details regarding the same, brand name certificate, xerox copies of invoices for the goods received from Ambala (Mixie Parts), turn over details for the financial year 1989-90. The Rama Industries by their letter dated 3-9-90 furnished all the details which has been received by Inspector of Central Excise. Madras III Division. The Assistant Collector of Central Excise, Madras III Division by his letter dated 8-8-91 to Rama Industries and 3 other separate units called upon them to report to him and explain the reasons for not filing the declaration for the financial year 1991. In response to the said letter Rama Industries filed the declaration on 4-7-91 which has been acknowledged by the Assistant Collector on 9-7-91. Certificate of registration dated 7-11-94 issued by Superintendent of Central Excise, Range III 'C' Madras - III Division to Rama Industries have also been produced showing the details of items manufactured by them. A separate certificate issued by the Department of Industries and Commerce registering both the units as SSI Units have also been produced. Form A.R. 4 for export under QBAL and application for removal of excisable goods for export by Meera Industries and Rama Industries which has been attested by the Superintendent of Central Excise, Range III has also been produced. RG 1 register showing register of parts of daily stock account of both the units have also been produced. The Superintendent of Central Excise had issued summons to both the units separately on 7-3-97 calling upon them to produce the various registers which had been done. The Deputy Commercial Tax Officer has also certified the premises of both the units and has given inspection of Form D 1 of the Commercial Tax Office Act which has also been produced to show the existence of functioning of two separate units. Various notices received from the Deputy Commercial Tax Officer has also been produced.
Rama Industries has also compounded the offences and compounding order passed by Deputy Commercial Tax Officer have also been produced.
Correspondences between Rama Industries and Bureau of Indian Standards and a certificate from the Department of Commercial Tax has also been produced to show the existence of individual units. The financial balance sheet of both the units have been audited and have been accepted by the Income-tax Department. Both the units have huge turn over and from the records produced it is very clear that Rama Industries was in existence and that the department was aware of its existence and have accepted RT 12 returns and declarations and also various registers maintained under Central Excise Act and has been inspected and seen by the Departmental officers. The Rama Industries has been separately located with separate lease deed and unit has been manufacturing different items namely LPG domestic gas stoves while Meera Industries had been manufacturing domestic pressure cookers and pans. The item being different the brand name is also different and the evidence on record here shows that Meera Industries could not have used the brand name of Rama Industries as the product of the Rama Industries is different. Be that as it may it is fundamental principles of natural justice that when these enormous evidences were examined at the time of inspection and the department was aware of the existence of Rama Industries then it was incumbent to have put the Rama Industries to notice. The violation of issue of show cause notice to Rama Industries has vitiated the proceedings. However we notice that the department in the show cause notice had alleged that Meera Industries were using brand name of Rama Industries and made themselves ineligible for the benefit of notification, while the Commissioner in the impugned order has proceeded to hold besides holding that Rama Industries is only on paper and a deemed unit and has also held flow back of funds between both the units. There is a clear contradiction in the finding of the Commissioner. Therefore, all the more it was incumbent for the department to have issued show cause notice to Rama Industries which had an independent existence with separate partners. None issue of show cause notice to Rama Industries and also for the reasons that department has taken different stand on the status of Rama Industries therefore the proceedings have become bad in law we are constrained to set aside the impugned order on this ground above in the light of the judgments relied by the ld. Counsel in the case of CCE v. Madan Lal; CCE v. Supreme Electrical Appliances and Dawn Fire Works v. CCE (supra).
15. We are also agreeable with the ld. Counsel's argument that the department was fully aware of the existence of the Rama Industries and that it had been receiving RT 12 returns and Rama Industries was maintaining separate registration under various legislation and their registration have been checked by the Inspectors, Superintendents and Assistant Commissioners of Central Excise. Therefore it follows that the department had full knowledge of the existence of Rama Industries and in that view of the matter, suppression of facts for invoking larger period is not sustainable and the demands are time-barred and requires to be set aside on this ground also. In view of the fact that the department has not issued show cause notice to Rama Industries and has proceeded to hold that Meera and Rama Industries to be one and the same and also that Meera Industries has used the brand name of Rama Industries making them ineligible for SSI exemption is bad in law.
Therefore, on this ground alone the impugned order is set aside and appeal allowed besides the other ground of time-bar and also for insufficiency of evidence to uphold the charges of evasion of duty in the matter. Appeals allowed.