Nayana S. Doshi, S.M. Doshi Huf, Vs. Commissioner of Central Excise - Court Judgment

Excerpt:

.....s.m. auxichem, shri surendra b.mishra, proprietor of m/s. s.r. corporation and m/s. chhaya sales corporation under rule 209 of the central excise rules, 1944 arise out of the order of the commissioner of central excise, mumbai.2. the demand has been confirmed as a result of clubbing the clearances of the above units and m/s. jigita chemicals on the ground that the other units were dummy units floated by s.m. doshi, proprietor of m/s.nehasu texprochem so as to split the turnover of his unit in order to remain within the ssi exemption limit.3. we have heard shri manoj sanklecha and shri yogesh patki, learned counsels and shri hitesh shah, learned dr.4. shri s.m. doshi, expired on 1st september, 2001 while the show cause notice issued to m/s. nehasu texprochem, of which he was proprietor, is dated 12th december, 2001, i.e. subsequent to his death. in these circumstances we see prima facie substance in the contention that smt.nayana s. doshi, widow and legal heir of shri s.m. doshi is not liable to pay duty, in the light of the tribunal's decision in the case of d.matai v. cce, mumbaimafhh products v. cce, surat 2003 (57) rlt 596. since the duty demand is prima facie not.....

Judgment:

1. The applications for waiver of pre-deposit of duty of Rs. 31,69,537/- confirmed against M/s. Nehasu Texprochem together with penalty of equal amount imposed upon them under Section 11AC of the Central Excise Act, 1944; and penalties of Rs. 5 lakhs and Rs. 1 lakh on Shri B.S. Doshi, proprietor of M/s. S.M. Auxichem, Shri Surendra B.Mishra, proprietor of M/s. S.R. Corporation and M/s. Chhaya Sales Corporation under Rule 209 of the Central Excise Rules, 1944 arise out of the order of the Commissioner of Central Excise, Mumbai.

2. The demand has been confirmed as a result of clubbing the clearances of the above units and M/s. Jigita Chemicals on the ground that the other units were dummy units floated by S.M. Doshi, proprietor of M/s.

Nehasu Texprochem so as to split the turnover of his unit in order to remain within the SSI exemption limit.

3. We have heard Shri Manoj Sanklecha and Shri Yogesh Patki, learned counsels and Shri Hitesh Shah, learned DR.4. Shri S.M. Doshi, expired on 1st September, 2001 while the show cause notice issued to M/s. Nehasu Texprochem, of which he was proprietor, is dated 12th December, 2001, i.e. subsequent to his death. In these circumstances we see prima facie substance in the contention that Smt.

Nayana S. Doshi, widow and legal heir of Shri S.M. Doshi is not liable to pay duty, in the light of the Tribunal's decision in the case of D.Matai v. CCE, MumbaiMafhh Products v. CCE, Surat 2003 (57) RLT 596. Since the duty demand is prima facie not sustainable against the heir the penalties imposed by the Commissioner on all the applicants are also not sustainable prima facie in the light of the Supreme Court decision in the case of CCE v.HMM Limited 1995 (76) ELT 497 (SC) followed by the Tribunal in the case of Pacific Granites Ltd. v. CCE, Jaipur 2001 (128) ELT 421; LML Ltd. v.CCE, New Delhi 2001 (130) ELT 480 2001; GTC Industries Ltd. v. CCE, Hyderabad 2001 (132) ELT 74; and CCE, Chennai v. Bush Boake Allen (India) Ltd. 2001 (132) ELT 343. We therefore, waive pre-deposit of the duty and penalties and stay recovery thereof pending these appeals.