Brief Facts of the Case: s8

Brief facts Of the Case :.

M/s. Ganesh Enterprise located at Prabhudas Patel Plot No.2,Near Sabar Tiles, Danilimbda, Ahmedabad, hereinafter referred to as "the said unit" for brevity, are engaged in the manufacture of Cellulose powder falling under Ch.39 of the Schedule to Central Excise Tariff Act, 1985. The said unit is not registered with Central Excise department. Intelligence was gathered that proprietor of said unit Shri Yogesh Chandradutt Dhariyal is having yet another unit under his proprietorship in the name and style of Dhariyal Chemicals engaged in the manufacture of identical products and he is indulging in evasion of duty by resorting to claiming exemption under Notification No.8/2003- CE dated 1.3.2003 separately for the goods manufactured and cleared in the name of Ganesh Enterprises. Based on the above information, on 29/30.08.2007, a search was carried out in the factory premises of said Dhariyal Chemicals, situated at 4, Prabhudas Estate, Near Sabar Estate, Danilimda, Ahmedabad in the presence of two independent panch witnesses and Shri Yogesh Chandradutt Dhariyal, Proprietor of said Dhariyal Chemicals.

2. Subsequently, Show Case Notice dated 28.04.2008 was issued from F. No. IV/13-04/CE/PI-I/07-08/case by the Joint Commissioner, Central Excise, Ahmedabad-I discussing all the evidences and co - relating Shri Yogesh C. Dhariyal, M/s. Dhariyal Chemicals and M/s. Ganesh Enterprise.

3. The demand raised in the above referred SCN dated 28.04.2008 was confirmed by the Additional Commissioner, Central Excise, Ahmedabad-I vide Order-in-Original No. 48/Addl. Comm./2009 dated 27.02.2009. On the basis of facts, evidences and discussions in the above OIO, the adjudicating Authority has found that Shri Yogesh C. Dhariyal was the de facto Proprietor of Ms.Ganesh Enterprise. Further, the Adjudicating Authority, in Para - 52 & 53 of the above order has held that Shri Yogesh Dhariyal is the real Proprietor of M/s. Ganesh Enterprise and Shri Yogesh Dhariyal, M/s. Ganesh Enterprise and M/s. Dhariyal Chemicals all the three are one and same for taxation purpose and they are not different legal entities. As Shri Yogesh Dhariyal was having two factories under his proprietorship, both factories were not separately entitled to get exemption from Central Excise duty in view of the specific provisions of Para - 2(v) of the notification No. 8/2003-CE, as amended Shri Yogesh Dhariyal has to be treated as 'manufacturer' for the purpose of availing exemption under Notification No. 8/2003-CE irrespective of the fact that he was running business / factories in the name of M/s. Dhariyal Chemicals and M/s. Ganesh Enterprise at different places. In this case the factory Viz. M/s. Dhariyal Chemicals was not availing exemption under Notification No. 8/2003-CE and not eligible for the said exemption. Therefore, M/s. Ganesh Enterprise, which is also under the same proprietorship, was not eligible for the SSI exemption under Notification No. 8/2003-CE. 4. During the course of above proceedings, M/s. Ganesh Enterprise were requested by the Superintendent, Central Excise, AR-I I D-IV, Ahmedabad-I vide letter F. No. AR-I/D-IV/Ganesh/2007-08 dated 19.11.2007 to take Central Excise registration and clear the goods on payment of Central Excise duties. However, the unit refused to take the registration as well as continued to clear goods without payment of duties and informed this office vide their letter dated 12.12.2007 that their turnover of goods manufactured did not exceed Rs. 1 Crore in any financial year and therefore, with the exemption limit granted by notification by Central Government to S.S.I. Units. Shri Yogesh Dhariayl, proprietor of M/s. Dhariyal Chemicals and M/s. Ganesh Enterprise was also requested vide letter F. No. ARI/Div-IV/ Ganesh/07-08 dated 11.12.2007, to take new registration for M/s. Ganesh Enterprise and clear the goods on payment of duties. However, Shri Yogesh Dhariyal vide letter dated 13.12.2007 informed that M/s. Ganesh Enterprise is not his proprietary unit and he do not have any interest in any matter in the said unit. He further informed that the there relation are only commercial relations and the transfers, if at all, are on principal to principal basis. 5. This office vide letter F.No. AR-I/DN-IV/Ganesh/2008-09 dated 19.03.2009 requested to provide the information regarding the clearances made from M/s. Ganesh Enterprise. M/s. Ganesh Enterprise vide letter F. No. GE/GDJ/2008-09/0323/1 dated 23.03.2009 has provided details of removal of final product and on the clearances made duty liability has been calculated and shown below:

Description CE Total Sales in Basic Edu. Cess Higher of Goods TH Rs. Excise @2% Edu. Cess Total Duty @1% Period from 22.04.2008 to 06.12.2008 (Basic Excise Duty @ 14%) Cellulose 39 Rs.9,72,325/- Rs. Rs. 2,723/- Rs. 1,361/- Rs. Powder 1,36,126/- 1,40,210/- Period from 07.12.2008 to 24.02.2009 (Basic Excise Duty @ 10%) Cellulose Rs. Rs. Rs. 2,020/- Rs. 1,010/- Rs. Powder 39 10,09,950/- 1,00,995/- 1,04,025/- Period from 25.02.2009 to 19.03.2009 (Basic Excise Duty @ 8% ) Cellulose 39 Rs. 7,20,163/- Rs. Rs. 1,152/- Rs. 576/- Rs. Powder 57,613/- 59,341/- Total Rs. Rs. 5,895/- Rs. 2,947/- Rs. 2,94,734/- 3,03,576/- 6. From the above, it appeared that M/s. Ganesh Enterprise is proprietary concern of Shri Yogesh Dhariyal, who is also operating his another firm M/s. Dhariyal Chemicals, Prabhudas Patel Plot No.4, Near Sabar tiles, Danilimada, Ahmedabad is not entitled for the benefit of SSI exemption as per 2 (v) of Notification 8/2003-CE dated 01.03.2003 and is liable to pay duty amounting to Rs. 3,03,576/- (Rupees Three Lakh Three Thousand Five Hundred Seventy Six Only), in view of the Show Case Notice date 28.04.2008 already issued and adjudicated vide Order in Original No. 48/Addl. Comm./2009 dated 27.02.2009, according to which it is already held by the department that M/s. Ganesh Enterprise is the another firm of Shri Yogesh Dhariyal and confirmed the demand. The said duty liability is arising against the clearances of goods for subsequent period

7. From the above said discussions it appeared that M/s. Ganesh Enterprise has contravened the provisions of Rule 4, 6, 9, 10,11,12 of Central Excise Rules, 2002 in as much as they have manufactured cleared excisable goods without payment of duty; failed to determine the duty liability on the goods; failed to obtain Central Excise Registration; failed to maintain Daily Stock Account in the prescribed manner; failed to issue valid invoice while removing excisable goods; failed to submit periodical returns indicating therein goods manufactured and clearedCommissioner,Central Excise,Division-IV, Ahmedabad -I for showing cause,as to why:

(1) The Central Excise duty amounting to Rs. 2,94,734/- (Rupees Two Lakh Ninety four thousand Seven Hundred Thirty Four Only) and Education Cess Rs. 5,895/- and Higher Edu. Cess Rs. 2,947/- involved on the goods manufactured and removed under the invoices of M/s. Ganesh Enterprise as detailed above, should not be confirmed and recovered under Section 11A (i) of CEA, 1944; (2) Interest at the rate applicable should not be charged under the provisions of Section 11AB of Central Excise Act, 1944 and recovered from them; (3) Penalty should not be imposed on them under the provisions of Section 11AC of CEA, 1944, Defence Reply: M/s. Ganesh Enterprises vide their letter No. Nil dated 28.07.2011 submitted the written reply to SCN as under:

At the outset I deny the charges and allegations levelled in the Show Cause Notice. I say and submit that Shri Yogesh Dhariyal is not the proprietor of M/s. Ganesh Enterprises and therefore, turnover of M/s Ganesh Enterprise cannot be included with turn over of M/s Dhariyal Chemicals. It is submitted that above referred Show Cause Notice dated 28.04.2008 was adjudicated by the Additional Commissioner, Central Excise vide Order-In-Original No. 48/Addl.Commr/09 dated 27-2-2009 (hereinafter referred to as "the earlier Order" for short). We had not accepted the Order-in-Original dated 27.02.09 and filed an Appeal before the Commissioner (Appeal-I) of Central Excise who upheld Order-in-Original dated 27.02.2009. The said Order-In-Appeal dated 07.01.2010 was further challenged before the Hon'ble Tribunal whereby the Hon'ble T ribunal vide O rde r No. A /192/VV ZB/AH D/2010 & S/158/VVZB/AHD/2010 dated 25.02.2010 in Appeal No. E/178/2010 allowed the Appeal by way of remand to the Adjudicating authority for adjudication in terms of the Order passed by the Hon'ble Tribunal. The Joint Commissioner vide Order-In-Original No. 33/Joint Commissioner/2010 dated 13.12.2010 confirmed the demand against Shri Yogesh Dhariyal by holding that Shri Yogesh Dhariyal is the proprietor of Ganesh Enterprise. The said Order-in- Original dated 13.12.2010 was challenged before the Hon'ble Commissioner (Appeals) who upheld the Order dated 13.12.2010. We are in process to file an appeal challenging Order- In-Appeal No. 73 and 74/2011 (Ahd 1)CE/MM/Commr(A)/Ahd dated 30.05.2011 before the Hon'ble Tribunal. Copies of above Order-In-Original dated 13.12.2010 and Order-In- Appeal dated 30.05.2011 are enclosed herewith and marked as Annexure A and B respectively.

2) It is stated that since the present protective Show Cause Notice has been issued based upon Show Cause Notice dated 28.04.2008. The said Notice has been culminated into Order-In-Appeal dated 30.05.2011. As time limit for filing appeal has not been expired and we are going to file appeal challenging 0IA, it is requested that the hearing of the captioned Show Cause Notice may kindly be kept in abeyance till appeal is decided by the Hon'ble Tribunal for avoiding multiplicity of proceedings.

3) Without prejudice to the aforesaid, I say and submit that Shri Yogesh Dhariyal has not deployed any fund for setting up M/s. Ganesh Enterprises. He had not invested money for formation of M/s. Ganesh Enterprises. There is no evidence to show that he had deployed funds for setting up Ganesh Enterprises.

4) I say and submit that machinery for carrying on the manufacturing activity of Ganesh Enterprises was not purchased out of Shri Yogesh Dhariyal's money. The Adjudication Authority and the first Appellate Authority erred in relying upon his statement in earlier Show Cause Notice dated 28.04.08, in which he had inter alia stated that he had made entire investment for starting M/s. Ganesh Enterprises. I say and submit that the said statement was retracted at the earliest available opportunity. It is settled law that when statement is contrary to the documentary evidence, evidence would prevail over statements particularly when the same are retracted.

5. The Department having accepted the legal position in the earlier Order that retraction of a confessional statement reduces its evidentiary value and there must be independent corroboration, the Hon'ble Additional Commissioner and the Hon'ble Commissioner (Appeals) should have held that such corroborative evidence was lacking.

The Hon'ble Additional Commissioner and the Hon'ble Commissioner (Appeals) erred in observing that Shri Yogesh Dhariyal was the proprietor of M/s. Ganesh Enterprises since he was managing all the activities of Ganesh Enterprises. I say and submit that the above orders had not cited a single piece of evidence to show that he made any initial investment for incorporation of the firm or to show that he was managing all activities of Ganesh Enterprises as proprietor thereof. As the undersigned had invested the amount in plant and machinery from my own funds, the allegation that Shri Yogesh Dhariyal is the proprietor and had invested money, is incorrect and contrary to the facts of the case. 6) It is wrongly alleged that Shri Yogesh Dhariyal was operating saving account of the undersigned held with Bank of Baroda, Bhariavnath Branch on the premise that his photograph was affixed on the opening form of saving account. The Show Cause Notice wrongly rely upon the account opening form alleged to have been obtained from the Bank under Bank's letter dated 5-9- 07. Even otherwise, the same did not relate to Ganesh Enterprises and none of the business transactions of the firm were transacted in the said account. In fact, transactions in the said account are of few thousand rupees only and assuming while denying that the said account belonged to and was operated by Shri Yogesh Dhariyal, it cannot be said on the basis thereof that he was the proprietor of Ganesh Enterprises for the simple reason that the said account was neither in the name of Ganesh Enterprises nor did it relate to the business transactions/ manufacturing activity of Ganesh Enterprises.

7) I say and submit that the Central Excise officers seized a passbook of the savings bank account with Bank of Baroda in dispute at the time of search from my premises. I am a real bank account holder and therefore, I was having possession of passbook at the time of search. Had Shri Yogesh Dhariyal operated the said account, the Central excise Officers would have found passbook from Shri Yogesh Dhariyal, possession which is not the case.

8) I say and submit that bank statement of the said savings account with Bank of Baroda in dispute shows that I had not made single transaction in Shri Yogesh Dhariyal's favour. Had the beneficial or real owner of the said bank account been Shri Yogesh Dhariyal, there would have been transactions in his name. All these circumstantial evidences show that Shri Yogesh Dhariyal was not real account holder of savings account with Bank of Baroda.

9) I say and submit that Shri Yogesh Dhariyal used to look after the business of the Ganesh Enterprise as Power of Attorney holder in my absence. Since he is my cousin brother and his factory is situated near to my factory, I had given Power of Attorney. It is for this reason that in some of the purchase bills/delivery challans, the suppliers have referred to him. This, by itself, cannot and does not mean that he was real proprietor of Ganesh Enterprise.

10) I say and submit that the power of attorney authorized Shri Yogesh Dhariyal to represent in the business dealings of Ganesh Enterprise with various persons, corporations, organizations and companies. Accordingly, in my absence, he used to interact with various persons in connection with the business of Ganesh Enterprise. The fact that such interaction did not involve signing as power of attorney holder cannot mean that he was not working as power of attorney holder. Nowhere, he had signed as proprietor of Ganesh Enterprise.

11) It is wrongly alleged that there was a financial flow back from M/s. Ganesh Enterprises to account of Shri Yogesh Dhariyal. The Show Cause Notice relied upon small payments made towards personal expenses of his family and LICs from my account. Since payments were marginal/nominal compared to the turn over of my firm and I had made these payments out of natural love and affection for his family, the same can by no stretch of imagination be called flow back of money of M/s. Ganesh Enterprises to them. The amount spent by me for his family, would not be more than Rs. 1.5 lacs. Since these payments were made out of love and affection and such payment was of personal nature and not related to business, and therefore does not lead to the conclusion that there was financial flow back from M/S Ganesh.Enterprises to Shri Yogesh Dhariyal. It is settled law that such transactions between relatives are normal and do not constitute financial flow back.

12) The Hon'ble Authorities erred in holding in the orders that since my firm paid electricity bill of Shri Vijay Dhariyal, there was a financial flow back from my firm. This is irrelevant to the question whether Shri Yogesh Dhariyal is the proprietor of M/s. Ganesh Enterprise and whether clearances of M/s. Ganesh Enterprises are liable to be clubbed with those of Dhariyal Chemical.

13)It is wrongly alleged of financial flow back from M/s. Ganesh Enterprises to M/s. Dhariyal Chemicals on the ground that electricity bill in respect of one meter of his firm was being paid by my firm. The Revenue failed to appreciate the fact that under an agreement between my firm and M/s Dhariyal Chemicals, in consideration of drawing steam and water by my firm from M/s. Dhariyal Chemicals, my firm had to pay a certain sum of money to his firm and also the electricity charges in respect of one meter. Since my firm had not paid the said sum of money, my firm continued to pay for the electricity charges so as to set off the said sum of money which was payable by him. I crave leave to refer to and rely upon Agreement dated 14-10- 1996 entered between my firm and M/s. Dhariyal Chemicals as well as a statement showing payment of electricity charges to set off of the amount payable under the agreement. It is erred in proceeding on the basis that during the period covered by the Notice, my firm was not drawing steam and electricity from the Dhariyal Chemical's factory and hence question of payment for electricity meter of his factory by my firm did not arise. The Authorities erred in not appreciating the fact that the payment for electricity during the period in question was continued to be made to set off the outstanding sum which was payable for the earlier period.

14) I say and submit that financial flow back can be said to take place between two persons/firms when the finances of one come from the other and the profits/income of the first mentioned person/firm flow back to the other. In the present case, there is no evidence at all to show that finances in my firm came from Shri Yogesh Dhariyal or M/s. Dhariyal Chemicals and that the income/profit of my firm flowed back his firm. It is clear from the evidence that finance of my firm was not generated /invested by Shri Yogesh Dhariyal and the income/ profit of my firm remained with me and the same has not been withdrawn by or paid to Shri Yogesh Dhariyal or his firm.

15) I say and submit that clearances of two units can be clubbed only when there is evidence of financial flowback which would show that one unit is a dummy of the other and exists only on paper. As discussed in aforesaid paragraphs, there is no financial flow back from my firm to Dhariyal Chemicals and therefore, turn over of my firm should not be clubbed with Dhariyal Chemicals. Even otherwise, it is stated that my firm is having independent existence as well as having separate machineries, income tax PAN, separate Sales Tax registration and separate electricity meter and separate registration under the Factory Act. In the following cases, it is held that clearance of two units can be clubbed only when there is evidence to show financial flow back or evidence to show that one unit is a dummy of the other. a) CCE V/s Arbuda Industries -2008 (230) E.L.T. 159 b) CCE V/s Auto India -2007 (213) E.L.T. 436 c) Studioline Interior Systems Pvt. Ltd. V/s. CCE - 2006 (201) E.L.T. 250

No such evidence exists in the present case.

16) I say and submit that the no single evidence has been adduced showing that Shri Yogesh Dhariyal is having control over my firm. The department had made a picture showing that Shri Yogesh Dhariyal is a real owner, to that effect the Department had relied on statements which were retracted from time to time. In the absence of corroborative evidence, it cannot be said that Shri Yogesh Dhariyal had control over my firm and it is submitted that the clearance of my firm should not be clubbed with M/s. Dhariyal Chemicals.

17) I say and submit that the statement retracted by me was not after thought. In the facts and circumstances of the case, it shows that Shri Yogesh Dhariyal is not a real owner of my firm and therefore, I had retracted a statement since a statement was recorded under coercion and threat.

18) Without prejudice to the aforesaid submissions, in any event it is submitted that the goods Cellulose Powder manufactured are not liable to duty at all. The Show Cause Notice demanded duty under Chapter 39 of the Central Excise Tariff without indicating the particular Heading/ sub-heading of Chapter39. It is submitted that the said goods are not classifiable under Chapter 39. It is submitted that as held by the Tribunal in the case of CCE v Reliance Cellulose Products Ltd-2000 (117) ELT 366 (upheld in 2001 (134) ELT A241, Cellulose Powder is not classifiable under Chapter 39 but is classifiable under Chapter 47 where the rate of duty is NIL.

19) It is submitted that Cellulose and its Chemical derivatives are classified under Chapter Heading no. 39.12 if the products are not elsewhere specified or included in other Chapter Headings. In the present case, M/s Ganesh Enterprise manufactured Cellulose powder out of raw materials viz. Micro Crystalline Cellulose Powder (cellulose fibres) and Maize Starch Powder. Both these products are covered under Chapter Heading No.47 as the pulp of this chapter consists essentially of cellulose fibres obtained from various vegetables materials or from waste textiles of vegetable origin. In terms of Chapter Heading 47, pulp is generally presented in baled sheets (whether or nor perforated), wet or dry, but may sometimes be in slabs, in rolls or in the form of powder or flakes. In the present case, Micro Crystalline Cellulose powder is a primary source of cellulose fibres. Micro Crystalline Cellulose powder has been defined under various dictionary which are as under : "As per Wikipedia Meaning and Definition on Microcrystalline'Microcrystalline cellulose: Microcrystalline cellulose is a term for refined wood pulp and is used as a texturizer, a anti-caking agent, a fat substitute, an emulsifier 17 Source : www.fao.org/docrep/w6355e/w6355e01.htm (Food and Agriculture Organization of the United Nations)

20) "Microcrystalline cellulose is a purified, partially depolymerized cellulose prepared by treating alpha-cellulose, obtained as a pulp from fibrous plant material, with mineral acids. The degree of polymerization is typically less than 400. Not more than 10% of the material has a particle size of less than 5 MM.

21) In view of the above published literatures, Microcrystalline Cellulose is a source of Cellulose fibres which is derived from fibrous plant materials (Vegetable origin) and the same has been specified in the HSN Notes under Chapter 47.

22) It is submitted that cellulose powder under dispute was not prepared by treating Cellulose with acetic anhydride, acetic acid, sulphuric acid or nitric acid. And it was not Cellulose Acetate butyrate and cellulose propionate as well as cellulose ethers and therefore, the goods in dispute cannot be classified under Chapter Heading 39 in terms of HSN notes.

23) We place reliance upon decision of C.C.Ex Vs Reliance Cellulose Products Ltd (supra) whereby the Hon'ble Tribunal held that end product being in powder form which is recognized by Notes under Chapter 47 of the HSN, the end product will fall under Chapter 47 and the same will automatically excluded from the ambit of Chapter 39. The Hon'ble Tribunal further held that since the product in that case did not fall under Chapter Heading 39, the Note 6(b) was of no use.

24) We say and submit that Circular No. 32/88 dated 15.12.88 and 6/90 CX dated 19.02.1990 will not be applied in the present case as we did not mix raw materials with hydrochloric acid which can be seen from panchnama dated 28/09.08.2007.

25) Penalty under Section 11AC can be imposed when liability of the duty subsist. In view of the facts and circumstances of the case, Shri Yogesh Dhariyal is not real owner of my firm and therefore, my firm is not required to pay duty on goods manufactured and cleared by my firm. My firm is owned by me and is manufacturing goods independently of M/s. Dhariyal Chemicals and hence the clearances of my firm cannot be clubbed with those of M/s Dhariyal Chemicals for demanding duty. Since there is no liability of duty, penalty under Section 11AC cannot be imposed.

26) I say and submit that Ganesh Enterprise is not liable for payment of interest under Section 11AB as there is no liability of duty in term of the above facts.

27) It is requested that an opportunity of hearing may kindly be given before the case is adjudicated.

Personal Hearing : Personal Hearing in the matter was held on 29.07.11. Shri Hardik Modh, Advocate appeared for the same on behalf of the assessee. He reiterated the submission made in reply dated 28.07.2011 and stated that their appeal was pending before Hon’ble CESTAT against order passed in main SCN and therefore they have requested to keep the matter in abeyance till the direction of Tribunal and that they have nothing more to add

Discussion and Findings: I have gone through the records of the case and the written submission dated 28.07.2011 filed by the assessee. I find that a show cause notice was issued to the assessee demanding Central Excise Duty amount to Rs. 88,026/- involved on the goods manufactured and removed by them during the period 01.04.2009 to 30.09.2009 by claiming exemption under Notfn. No. 8/2003-CE dated 01.03.2003 for which they were not eligible. It has been observed in the Show Cause Notice that Shri Yogesh C. Dhariyal, the proprietor of M/s. Dhariyal Chemicals was de-facto proprietor of M/s. Ganesh Enterprise, both the factories were not separately entitled to get exemptionfrom Central Excise Duty under Notfn. No. 8/2003-CE dated 01.03.2003 and clearance value to both has to be clubbed for determining their duty liability in terms of Para2(V) of Nofn. No. 8/2003- CE dated 01.03.2003, as amended.

The assessee vide their letter dated 28.07.2011 submitted the reply to show cause notice denying the charges and allegations leveled in the show cause notice. He has stated that Shri Yogesh Dhariyal is not the proprietor of M/s. Ganesh Enterprises and therefore turnover of M/s. Ganesh Enterprise can not be included with the turn over of M/s. Dhariyal Chemicals. I find that a demand in the same issue was confirmed vide OIO No. 48/Addl Commr/09 dated 27.02.2009 which was upheld by Commr. (Appeal) vide OIA dated 07.01.2010. On being challenged by the assessee before the Hon’ble CESTAT, The CESTAT vide order no. A/192/WZB/AHD/2010 & S/158/WZB/AHD/2010 dated 25.02.10 had remanded the order to the Adjudicating Authority for reconsideration of the submission made by the assessee after giving them another opportunity to present their case. Accordingly the Joint Commissioner of Central Excise, Ahmedabad vide OIO No. 33/Jt. Commr/2010 dated 13.12.10 adjudicated the case confirming the demand of duty with interest, confiscating the goods and imposing penalty upon the assessee under Section 11AC of Central Excise Act, 1944, holding Shri Yogesh C. Dhariyal the real proprietor of M/s. Ganesh Enterprise and denying the benefit of exemption under Notfn. No. 8/2003-CE dated 01.03.03 to the assessee.

The assessee in their submission dated 28.07.11 have requested that since the present SCN has been issued based upon the SCN dated 24.08.08 which has been culminated into OIA dated 30.05.11 and they are going to file appeal challenging the OIA, the hearing may be kept in abeyance till the decision of their appeal before the Hon’ble Tribunal.

I find that the present SCN is pending for more than one year and denovo case in the same issue has already been decided by the Joint Commissioner vide OIO No. 33/Jt. Commr/2010 dated 13.12.10, the matter can not be kept pending further and as such the same is taken up for finalizing adjudication proceedings.

I find that in Hon'ble CESTAT the case of Treadwell Rubbers Vs CCE, Mangalore [2007 (212) ELT 551 (Tri.-Bang.)], relying upon the case of Quality Steel Industries Vs Collector [1989 (43) ELT 775 (Tn.), which was also upheld in Apex Court as reported in 1999 (107) ELT A61 (SC)], has interalia held at Para 7 of the order as under:

"We find that the Adjudicating Authority has rightly decided the issues in accordance with the remand order dated 21-1- 2002 of the Tribunal. After examining the Board's guidelines and several case law, he has come to the conclusion that the clearances of M/s. Tradewell Rubbers and M/s. Excel Tyres & Rubber Products should be clubbed. Shri George Kurian is the proprietor of one unit and Smt Annie George is the proprietrix of another unit. They are husband and wife. Smt. Annie George has also given General Power of Attorney to Shri George Kurian. For all intense and purpose, the whole show was being run by George Kurian." In the aforesaid case, the Tribunal has ordered for clubbing of clearance of both units. In this case, Shri. Yogesh Dhariyal and Shri Ganesh Josh i are cousins. Shri Ganesh Josh' has claimed to given a Power of Attorney to Shri. Yogesh Dhariyal for doing all the work of his proprietorship firm. But, it is established beyond doubt that the entire show was being run by Shri. Yogesh Dhariyal. So, I am of the view that the clearance values of M/s. Dhariyal Chemicals and M/s. Ganesh Enterprise are liable to be clubbed in view of the aforesaid case law also.

In view of the aforesaid facts, evidences and discussion I find that Shri. Yogesh C. Dhariyal was the defacto Proprietor of M/s. Ganesh Enterprise and not Shri Ganesh Joshi. As M/s. Ganesh Enterprise located at Prabhudas Patel Plot No.2, Near Sabar Tiles, Danilimbda, Ahmedabad Shri Yogesh Dhariyal was having two factories under his proprietorship; both factories were not separately entitled to get exemption from central excise duty in view of the specific provisions of Para 2(v) of the Notification No. 8/2003-CE, as amended. Further, I hold that Shri. Yogesh Dhariyal has to be treated as a 'manufacturer' for the purpose of availing exemption under Notification No. 8/2003-CE irrespective of the fact that he was running business/factories in the name of M/s. Dhariyal Chemicals and M/s. Ganesh Enterprise at different places. As per Para 2(i) of the Notification No. 8/2003-CE, a manufacturer has option not to avail the exemption contained in this notification and instead pay the normal rate of duty on the goods cleared by them; such option shall be exercised before effecting first clearances at the normal rate of duty and such option shall not be withdrawn during the remaining part of the financial year. In this case the factory viz. M/s. Dhariyal Chemicals was not availing exemption under Notification No. 8/2003-CE and not eligible for the said exemption. Therefore, M/s. Ganesh Enterprise, which is also under the same proprietorship, was not eligible for the SSI exemption under Notification No. 8/2003-CE.

It is a very clear position of the law that the Proprietor and Proprietary firm are one and same for taxation purpose. The name given to the Proprietary firm is just a name given to the business, but, the legal entity remains the Proprietor only. Therefore, I hold that Shri. Yogesh Dhariyal, M/s. Ganesh Enterprise and M/s. Dhariyal Chemicals all the three are one and same for taxation purpose and they are not different legal entities. I find no force in the contention of Shri. Yogesh Dhariyal to the effect that demand of duty should be made to M/s. Ganesh Enterprise and not to him.

In view of the above, I hold that Shri. Yogesh Chandradutt Dhariyal was the real Proprietor of M/s. Ganesh Enterprise and he was not eligible for SSI exemption under Notification No. 8/2003-CE, as amended, for M/s. Ganesh Enterprise. Therefore, he was required to pay Central Excise duty of normal rate, which was not paid by him. Therefore, I find the demand of Central Excise duty made to Shri. Yogesh Dhariyal, Proprietor of M/s. Ganesh Enterprise is to be confirmed under the provisions of Sub Section (2) of Section 11A of the Central Excise Act, 1944. The said unit in their written submission dated 28.07.2011 has contended that the goods cellulose powder manufacture by them are not liable to duty at all as the same is not classifiable under Chapter 39 but is classifiable under Chapter 47 where the rate of duty is nil.

It is not disputed that they are engaged in manufacturing of Cellulose Powder,as far as the classification is concerned. I Have categorically held that it is correctly classifiable under CTH 3912 and not under4704 as claimed by them,as the Cellulose Powder is specifically covered under CTH 3912, Whereas the CTH 4704 Covers only Pulp of Wood or of other Cellulosic Material and does not cover exclusively cellulose.

Apart from the above, I find that Central Board of Excise & Customs (Board) had occasion to deliberate on the issue of classification of Cellulose Powder. In this regard, the relevant portion of Board's Circular No. 6/90-CX.3, dated 19-2-1990 issued from F. No. 93/5/90-CX.3 is reproduced below:

"Doubts have been expressed regarding the correct classification of Cellulose Powder/micro-crystalline Cellulose Powder, and bleached cotton linters/bleached cotton linter pulp, whether under Chapter 14 or 39 or 47 of CET. It also appears that there is a divergence in practice in the field formation

2. The matter has been examined. The main raw materials for the manufacture of Cellulose Powder/microcrystalline cellulose powder are reported to be bleached cotton linters or hosiery rags or cotton waste or wood pulp- etc. The raw material is mixed with hydrochloric acid and boiled for about 1 to 2 hours and thereafter the material is washed with plain water. It is later semi- dried in a drier, pulverized to fine powder and again dried, The resultant material is Cellulose Powder/micro-crystalline Cellulose Powder. The classification of this product under Chapter 14 is not appropriate inasmuch as it only covers vegetable plaiting materials; vegetable products, not elsewhere specified or included. The classification of the product under Heading 29.42 as "other organic compounds" is not correct. The Heading covers separate chemically defined organic compounds not classified elsewhere. The Cellulose Powder is not a separate chemically defined organic compound as well. It is merely cellulose obtained from out of bleached cotton linters, hosiery rags, wood pulp etc. The classification of the product under Chapter 47 (Heading 47.01) also does not appear to be correct. As per the Chapter Notes under Chapter 47 of HSN, the pulp covered by that Chapter consists essentially of cellulose fibers. Therefore, it is clear that the product which is covered by Chapter 47 is not exclusively cellulose. On the other hand, Heading 39.12 specifically covers "cellulose and its chemical derivatives". As per Explanatory Note under Heading 39.12 of HSN, cellulose, not elsewhere specified or included, in primary forms, is covered under the Heading 39.12. The Cellulose Powder/ microcrystalline Cellulose Powder, which is reported to be in Powder form, would also be covered by the expression "primary form", as per Note 6(b) of Chapter 39 of CET. Therefore, the appropriate classification of Cellulose Powder under Central Excise Tariff would be under Sub- heading 3912.90. In this connection your attentions is also invited to the instructions contained in Board's letter F. No. 93/51/88-CX.3 (Circular No. 32/88), dated 15-12-1988 on the same issue in the context of the old Tariff." In view of the position stated hereinabove, I do not find any merit in the argument put forwarded by Shri Yogesh Dhariyal and the Cellulose Powder manufactured by him in the factory of M/s. Ganesh Enterprise will fall under Ch.47 and therefore the same is exempted.

In view of the above fact and discussion, I hold that the said unit has contravened the provisions of Central Excise Rules, 2002 as under: Rule 4: By not paying duty of excise on excisable goods manufactured and cleared by them in the prescribed manner. Rule 6: By not assessing correct amount of duty at the time of removal. Rule 9: By not obtaining separate central excise registration of M/s. Ganesh Enterprise in as much as it was situated away from M/s. Dhariyal Chemicals and separate registration is required for each factory even though the Proprietor is same. Rule 10: By not maintaining Daily Stock Account records in proper Manner. Rule 11: By removing excisable goods without prescribed invoices. Rule 12: By not filing monthly return in the prescribed form.

Further, I hold that the said unit has wrongly availed the benefit of the scheme of SSI exemption under Notification No. 8/2003- CE, as amended. Further, the said unit has contravened these provisions on account of fraud, suppression of facts and contravention of rules with intent to evade payment of duty, therefore the said unit is liable to penalty under the provisions of Section 11AC of the Central Excise Act, 1944. In the case of UOI Vs. Dharmendra Textile Processors [2008 (231) ELT 3 (SC) - 2008-TIOL-192-SC-CX- LB], the Larger Bench of Hon'ble Supreme Court has held that there is no discretion to reduce penalty under Section 11AC and means rea is not essential ingredient to impose penalty there under. So, penalty equal to duty is imposable in this case.

In view of the above facts and discussion, I pass the following order:

:ORDER: 1 I hold thatCellulose Powder manufactured by M/S Ganesh Enterprise is correctly classifiable under Chapter 39 of the Schedule to the Central Excise Tariff Act.1985 and not under Ch 47 as contended by the said unit . 2. I confirm the demand of Central Excise duty payable by Shri Yogesh C. Dhariyal, Proprietor of M/s. Ganesh Enterprise amounting to Rs. 2,94,734/-, Education Cess of Rs. 5,895/- and Secondary & Higher Education Cess of Rs. 2,947/-, totaling to Rs. 3,035,76/- (Rupees Three lakh Three thousand Five hundred and Seventy Six

only) under the provisions of Sub-Section (2) of Section 11A of Central Excise Act, 1944. 3. I confirm the demand of interest at the rates prescribed under the provisions of Section 11AB of the Central Excise Act, 1944. 4. I impose a penalty of Rs.303576/- on M/S Ganesh Enterprise under the provisions of Section 11AC of the Central Excise Act, 1944.

5. In terms of the provisions of Sec.11AC OF Central Excise Act, 1944,where such duty, as determined under sub-sec. (2) of sec. 11A And the interest payable thereon under sec. 11AB of C. E. Act,1944.is paid within 30 days from the date of receipt of this order determining such duty, the Amt. of penalty liable to be paid by such person under this sec., shall be twenty five per cent of the duty so determined.

Accordingly, Sri Yogesh C Dhariyal, Proprieter of the said unit are given an option to avail the payment of reduced penalty under sec. 11AC of CE Act 1944, subject to the condition that the entire Amt. of duty so determined and confirmed hereinabove alongwith interest at appropriate rate and 25% of duty as penaltyim posed U/S. 11AC of CEA,1944. If the same is not paid within 30 days of receipt of the order the said option will not be available to them and they will be liable to pay the entire amount of penalty, U/S. 11 AC Of the C E Act,1944.

(U B SINGH ) DEPUTY COMMISSIONER, CENTRAL EXCISE, DIV-IV, AHMEDABAD-I

BY R.P.A.D. F.No. V.39/03-21/09-10/Div-IV/DA Date: 29/08/2011

To, M/s. Ganesh Enterprise, Prabhudas Patel Plot No.2, Near Sabar Tiles, Danilimbda, Ahmedabad-

Copy to :

1. The Assistant Commissioner(RRA), Central Excise, Ahmedabad-I 2. The Superintendent ,AR-I, DIV-IV,Ahmedabad-I. 3. Guard File. Brief facts Of the Case :.

M/s. Ganesh Enterprise located at Prabhudas Patel Plot No.2,Near Sabar Tiles, Danilimbda, Ahmedabad, hereinafter referred to as "the said unit" for brevity, are engaged in the manufacture of Cellulose powder falling under Ch.39 of the Schedule to Central Excise Tariff Act, 1985. The said unit is not registered with Central Excise department. Intelligence was gathered that proprietor of said unit Shri Yogesh Chandradutt Dhariyal is having yet another unit under his proprietorship in the name and style of Dhariyal Chemicals engaged in the manufacture of identical products and he is indulging in evasion of duty by resorting to claiming exemption under Notification No.8/2003- CE dated 1.3.2003 separately for the goods manufactured and cleared in the name of Ganesh Enterprises. Based on the above information, on 29/30.08.2007, a search was carried out in the factory premises of said Dhariyal Chemicals, situated at 4, Prabhudas Estate, Near Sabar Estate, Danilimda, Ahmedabad in the presence of two independent panch witnesses and Shri Yogesh Chandradutt Dhariyal, Proprietor of said Dhariyal Chemicals.

2. Subsequently, Show Case Notice dated 28.04.2008 was issued from F. No. IV/13-04/CE/PI-I/07-08/case by the Joint Commissioner, Central Excise, Ahmedabad-I discussing all the evidences and co - relating Shri Yogesh C. Dhariyal, M/s. Dhariyal Chemicals and M/s. Ganesh Enterprise.

3. The demand raised in the above referred SCN dated 28.04.2008 was confirmed by the Additional Commissioner, Central Excise, Ahmedabad-I vide Order-in-Original No. 48/Addl. Comm./2009 dated 27.02.2009. On the basis of facts, evidences and discussions in the above OIO, the adjudicating Authority has found that Shri Yogesh C. Dhariyal was the de facto Proprietor of Ms.Ganesh Enterprise. Further, the Adjudicating Authority, in Para - 52 & 53 of the above order has held that Shri Yogesh Dhariyal is the real Proprietor of M/s. Ganesh Enterprise and Shri Yogesh Dhariyal, M/s. Ganesh Enterprise and M/s. Dhariyal Chemicals all the three are one and same for taxation purpose and they are not different legal entities. As Shri Yogesh Dhariyal was having two factories under his proprietorship, both factories were not separately entitled to get exemption from Central Excise duty in view of the specific provisions of Para - 2(v) of the notification No. 8/2003-CE, as amended Shri Yogesh Dhariyal has to be treated as 'manufacturer' for the purpose of availing exemption under Notification No. 8/2003-CE irrespective of the fact that he was running business / factories in the name of M/s. Dhariyal Chemicals and M/s. Ganesh Enterprise at different places. In this case the factory Viz. M/s. Dhariyal Chemicals was not availing exemption under Notification No. 8/2003-CE and not eligible for the said exemption. Therefore, M/s. Ganesh Enterprise, which is also under the same proprietorship, was not eligible for the SSI exemption under Notification No. 8/2003-CE.

4. During the course of above proceedings, M/s. Ganesh Enterprise were

requested by the Superintendent, Central Excise, AR-I I D-IV, Ahmedabad-I vide letter F. No. AR-I/D-IV/Ganesh/2007-08 dated 19.11.2007 to take Central Excise registration and clear the goods on payment of Central Excise duties. However, the unit refused to take the registration as well as continued to clear goods without payment of duties and informed this office vide their letter dated 12.12.2007 that their turnover of goods manufactured did not exceed Rs. 1 Crore in any financial year and therefore, with the exemption limit granted by notification by Central Government to S.S.I. Units. Shri Yogesh Dhariayl, proprietor of M/s. Dhariyal Chemicals and M/s. Ganesh Enterprise was also requested vide letter F. No. ARI/Div-IV/ Ganesh/07-08 dated 11.12.2007, to take new registration for M/s. Ganesh Enterprise and clear the goods on payment of duties. However, Shri Yogesh Dhariyal vide letter dated 13.12.2007 informed that M/s. Ganesh Enterprise is not his proprietary unit and he do not have any interest in any matter in the said unit. He further informed that the there relation are only commercial relations and the transfers, if at all, are on principal to principal basis.

5. This office vide letter F.No. AR-I/DN-IV/Ganesh/2008-09 dated 15.04.09 requested to provide the information regarding the clearances made from M/s. Ganesh Enterprise. M/s. Ganesh Enterprise vide letter dated 21.04.2010 has provided details of removal of final product and on the clearances made duty liability has been calculated and shown below:

Description CE Total Sales in Basic Edu. Cess Higher of Goods TH Rs. Excise @2% Edu. Cess Total Duty @1% Period from 01.10.2009 to 26.02.2010 (Basic Excise Duty @ 8%) Cellulose 39 Rs.6,42,975/- Rs51,438/- Rs. 1,029/- Rs. 514/- Rs.52,981/- Powder Period from 27.02.2010 to 31.03.2010 (Basic Excise Duty @ 10%) Cellulose Rs14675/- Rs6718/- Rs.134/- Rs.67/- Rs.6919/- Powder 39 Total 710150/- Rs.58156/- Rs. 1163/- Rs. 581/- Rs.59900/- 6. From the above, it was observed that M/s. Ganesh Enterprise is proprietary concern of Shri Yogesh Dhariyal, who is also operating his another firm M/s. Dhariyal Chemicals, Prabhudas Patel Plot No.4, Near Sabar tiles, Danilimada, Ahmedabad is not entitled for the benefit of SSI exemption as per 2 (v) of Notification 8/2003-CE dated 01.03.2003 and is liable to pay duty amounting to Rs. 3,03,576/- (Rupees Three Lakh Three Thousand Five Hundred Seventy Six Only), in view of the Show Case Notice date 28.04.2008 already issued and adjudicated vide Order in Original No. 48/Addl. Comm./2009 dated 27.02.2009, according to which it is already held by the department that M/s. Ganesh Enterprise is the another firm of Shri Yogesh Dhariyal and confirmed the demand. The said duty liability is arising against the clearances of goods for subsequent period

7. From the above said discussions it was observed that M/s. Ganesh Enterprise has contravened the provisions of Rule 4, 6, 9, 10,11,12 of Central Excise Rules, 2002 in as much as they have manufactured cleared excisable goods without payment of duty; failed to determine the duty liability on the goods; failed to obtain Central Excise Registration; failed to maintain Daily Stock Account in the prescribed manner; failed to issue valid invoice while removing excisable goods; failed to submit periodical returns indicating therein goods manufactured and cleared by them.:Hence a show cause notice was issued to the said unit calling upon them to show cause as to ,why;

(1) The Central Excise duty amounting to Rs. 58,156/- (Rupees Fifty Eight thousand One Hundred Fifty Six Only) and Education Cess Rs.1163/- and Higher Edu. Cess Rs. 581/- involved on the goods manufactured and removed under the invoices of M/s. Ganesh Enterprise as detailed above, should not be confirmed and recovered under Section 11A (i) of CEA, 1944; (2) Interest at the rate applicable should not be charged under the provisions of Section 11AB of Central Excise Act, 1944 and recovered from them; (3) Penalty should not be imposed on them under the provisions of Section 11AC of CEA, 1944, Defence Reply: M/s. Ganesh Enterprises vide their letter No. Nil dated 28.07.2011 submitted the written reply to SCN as under:

At the outset I deny the charges and allegations levelled in the Show Cause Notice. I say and submit that Shri Yogesh Dhariyal is not the proprietor of M/s. Ganesh Enterprises and therefore, turnover of M/s Ganesh Enterprise cannot be included with turn over of M/s Dhariyal Chemicals. It is submitted that above referred Show Cause Notice dated 28.04.2008 was adjudicated by the Additional Commissioner, Central Excise vide Order-In-Original No. 48/Addl.Commr/09 dated 27-2-2009 (hereinafter referred to as "the earlier Order" for short). We had not accepted the Order-in-Original dated 27.02.09 and filed an Appeal before the Commissioner (Appeal-I) of Central Excise who upheld Order-in-Original dated 27.02.2009. The said Order-In-Appeal dated 07.01.2010 was further challenged before the Hon'ble Tribunal whereby the Hon'ble T ribunal vide O rde r No. A /192/VV ZB/AH D/2010 & S/158/VVZB/AHD/2010 dated 25.02.2010 in Appeal No. E/178/2010 allowed the Appeal by way of remand to the Adjudicating authority for adjudication in terms of the Order passed by the Hon'ble Tribunal. The Joint Commissioner vide Order-In-Original No. 33/Joint Commissioner/2010 dated 13.12.2010 confirmed the demand against Shri Yogesh Dhariyal by holding that Shri Yogesh Dhariyal is the proprietor of Ganesh Enterprise. The said Order-in- Original dated 13.12.2010 was challenged before the Hon'ble Commissioner (Appeals) who upheld the Order dated 13.12.2010. We are in process to file an appeal challenging Order- In-Appeal No. 73 and 74/2011 (Ahd 1)CE/MM/Commr(A)/Ahd dated 30.05.2011 before the Hon'ble Tribunal. Copies of above Order-In-Original dated 13.12.2010 and Order-In- Appeal dated 30.05.2011 are enclosed herewith and marked as Annexure A and B respectively.

2.It is stated that since the present protective Show Cause Notice has been issued based upon Show Cause Notice dated 28.04.2008. The said Notice has been culminated into Order-In-Appeal dated 30.05.2011. As time limit for filing appeal has not been expired and we are going to file appeal challenging 0IA, it is requested that the hearing of the captioned Show Cause Notice may kindly be kept in abeyance till appeal is decided by the Hon'ble Tribunal for avoiding multiplicity of proceedings.

3. Without prejudice to the aforesaid, I say and submit that Shri Yogesh Dhariyal has not deployed any fund for setting up M/s. Ganesh Enterprises. He had not invested money for formation of M/s. Ganesh Enterprises. There is no evidence to show that he had deployed funds for setting up Ganesh Enterprises.

4. I say and submit that machinery for carrying on the manufacturing activity of Ganesh Enterprises was not purchased out of Shri Yogesh Dhariyal's money. The Adjudication Authority and the first Appellate Authority erred in relying upon his statement in earlier Show Cause Notice dated 28.04.08, in which he had inter alia stated that he had made entire investment for starting M/s. Ganesh Enterprises. I say and submit that the said statement was retracted at the earliest available opportunity. It is settled law that when statement is contrary to the documentary evidence, evidence would prevail over statements particularly when the same are retracted.

5. The Department having accepted the legal position in the earlier Order that retraction of a confessional statement reduces its evidentiary value and there must be independent corroboration, the Hon'ble Additional Commissioner and the Hon'ble Commissioner (Appeals) should have held that such corroborative evidence was lacking.

The Hon'ble Additional Commissioner and the Hon'ble Commissioner (Appeals) erred in observing that Shri Yogesh Dhariyal was the proprietor of M/s. Ganesh Enterprises since he was managing all the activities of Ganesh Enterprises. I say and submit that the above orders had not cited a single piece of evidence to show that he made any initial investment for incorporation of the firm or to show that he was managing all activities of Ganesh Enterprises as proprietor thereof. As the undersigned had invested the amount in plant and machinery from my own funds, the allegation that Shri Yogesh Dhariyal is the proprietor and had invested money, is incorrect and contrary to the facts of the case.

6) It is wrongly alleged that Shri Yogesh Dhariyal was operating saving account of the undersigned held with Bank of Baroda, Bhariavnath Branch on the premise that his photograph was affixed on the opening form of saving account. The Show Cause Notice wrongly rely upon the account opening form alleged to have been obtained from the Bank under Bank's letter dated 5-9- 07. Even otherwise, the same did not relate to Ganesh Enterprises and none of the business transactions of the firm were transacted in the said account. In fact, transactions in the said account are of few thousand rupees only and assuming while denying that the said account belonged to and was operated by Shri Yogesh Dhariyal, it cannot be said on the basis thereof that he was the proprietor of Ganesh Enterprises for the simple reason that the said account was neither in the name of Ganesh Enterprises nor did it relate to the business transactions/ manufacturing activity of Ganesh Enterprises.

7) I say and submit that the Central Excise officers seized a passbook of the savings bank account with Bank of Baroda in dispute at the time of search from my premises. I am a real bank account holder and therefore, I was having possession of passbook at the time of search. Had Shri Yogesh Dhariyal operated the said account, the Central excise Officers would have found passbook from Shri Yogesh Dhariyal, possession which is not the case.

8) I say and submit that bank statement of the said savings account with Bank of Baroda in dispute shows that I had not made single transaction in Shri Yogesh Dhariyal's favour. Had the beneficial or real owner of the said bank account been Shri Yogesh Dhariyal, there would have been transactions in his name. All these circumstantial evidences show that Shri Yogesh Dhariyal was not real account holder of savings account with Bank of Baroda.

9) I say and submit that Shri Yogesh Dhariyal used to look after the business of the Ganesh Enterprise as Power of Attorney holder in my absence. Since he is my cousin brother and his factory is situated near to my factory, I had given Power of Attorney. It is for this reason that in some of the purchase bills/delivery challans, the suppliers have referred to him. This, by itself, cannot and does not mean that he was real proprietor of Ganesh Enterprise.

10. I say and submit that the power of attorney authorized Shri Yogesh Dhariyal to represent in the business dealings of Ganesh Enterprise with various persons, corporations, organizations and companies. Accordingly, in my absence, he used to interact with various persons in connection with the business of Ganesh Enterprise. The fact that such interaction did not involve signing as power of attorney holder cannot mean that he was not working as power of attorney holder. Nowhere, he had signed as proprietor of Ganesh Enterprise.

11. It is wrongly alleged that there was a financial flow back from M/s. Ganesh Enterprises to account of Shri Yogesh Dhariyal. The Show Cause Notice relied upon small payments made towards personal expenses of his family and LICs from my account. Since payments were marginal/nominal compared to the turn over of my firm and I had made these payments out of natural love and affection for his family, the same can by no stretch of imagination be called flow back of money of M/s. Ganesh Enterprises to them. The amount spent by me for his family, would not be more than Rs. 1.5 lacs. Since these payments were made out of love and affection and such payment was of personal nature and not related to business, and therefore does not lead to the conclusion that there was financial flow back from M/S Ganesh.Enterprises to Shri Yogesh Dhariyal. It is settled law that such transactions between relatives are normal and do not constitute financial flow back.

12. The Hon'ble Authorities erred in holding in the orders that since my firm paid electricity bill of Shri Vijay Dhariyal, there was a financial flow back from my firm. This is irrelevant to the question whether Shri Yogesh Dhariyal is the proprietor of M/s. Ganesh Enterprise and whether clearances of M/s. Ganesh Enterprises are liable to be clubbed with those of Dhariyal Chemical.

13. It is wrongly alleged of financial flow back from M/s. Ganesh Enterprises to M/s. Dhariyal Chemicals on the ground that electricity bill in respect of one meter of his firm was being paid by my firm. The Revenue failed to appreciate the fact that under an agreement between my firm and M/s Dhariyal Chemicals, in consideration of drawing steam and water by my firm from M/s. Dhariyal Chemicals, my firm had to pay a certain sum of money to his firm and also the electricity charges in respect of one meter. Since my firm had not paid the said sum of money, my firm continued to pay for the electricity charges so as to set off the said sum of money which was payable by him. I crave leave to refer to and rely upon Agreement dated 14-10-1996 entered between my firm and M/s. Dhariyal Chemicals as well as a statement showing payment of electricity charges to set off of the amount payable under the agreement. It is erred in proceeding on the basis that during the period covered by the Notice, my firm was not drawing steam and electricity from the Dhariyal Chemical's factory and hence question of payment for electricity meter of his factory by my firm did not arise. The Authorities erred in not appreciating the fact that the payment for electricity during the period in question was continued to be made to set off the outstanding sum which was payable for the earlier period.

14. I say and submit that financial flow back can be said to take place between two persons/firms when the finances of one come from the other and the profits/income of the first mentioned person/firm flow back to the other. In the present case, there is no evidence at all to show that finances in my firm came from Shri Yogesh Dhariyal or M/s. Dhariyal Chemicals and that the income/profit of my firm flowed back his firm. It is clear from the evidence that finance of my firm was not generated /invested by Shri Yogesh Dhariyal and the income/ profit of my firm remained with me and the same has not been withdrawn by or paid to Shri Yogesh Dhariyal or his firm.

15. I say and submit that clearances of two units can be clubbed only when there is evidence of financial flowback which would show that one unit is a dummy of the other and exists only on paper. As discussed in aforesaid paragraphs, there is no financial flow back from my firm to Dhariyal Chemicals and therefore, turn over of my firm should not be clubbed with Dhariyal Chemicals. Even otherwise, it is stated that my firm is having independent existence as well as having separate machineries, income tax PAN, separate Sales Tax registration and separate electricity meter and separate registration under the Factory Act. In the following cases, it is held that clearance of two units can be clubbed only when there is evidence to show financial flow back or evidence to show that one unit is a dummy of the other. a. CCE V/s Arbuda Industries -2008 (230) E.L.T. 159

b. CCE V/s Auto India -2007 (213) E.L.T. 436

c. Studioline Interior Systems Pvt. Ltd. V/s. CCE - 2006 (201) E.L.T. 250

No such evidence exists in the present case.

16. I say and submit that the no single evidence has been adduced showing that Shri Yogesh Dhariyal is having control over my firm. The department had made a picture showing that Shri Yogesh Dhariyal is a real owner, to that effect the Department had relied on statements which were retracted from time to time. In the absence of corroborative evidence, it cannot be said that Shri Yogesh Dhariyal had control over my firm and it is submitted that the clearance of my firm should not be clubbed with M/s. Dhariyal Chemicals.

17. I say and submit that the statement retracted by me was not after thought. In the facts and circumstances of the case, it shows that Shri Yogesh Dhariyal is not a real owner of my firm and therefore, I had retracted a statement since a statement was recorded under coercion and threat.

18. Without prejudice to the aforesaid submissions, in any event it is submitted that the goods Cellulose Powder manufactured are not liable to duty at all. The Show Cause Notice demanded duty under Chapter 39 of the Central Excise Tariff without indicating the particular Heading/ sub-heading of Chapter39. It is submitted that the said goods are not classifiable under Chapter 39. It is submitted that as held by the Tribunal in the case of CCE v Reliance Cellulose Products Ltd-2000 (117) ELT 366 (upheld in 2001 (134) ELT A241, Cellulose Powder is not classifiable under Chapter 39 but is classifiable under Chapter 47 where the rate of duty is NIL.

19. It is submitted that Cellulose and its Chemical derivatives are classified under Chapter Heading no. 39.12 if the products are not elsewhere specified or included in other Chapter Headings. In the present case, M/s Ganesh Enterprise manufactured Cellulose powder out of raw materials viz. Micro Crystalline Cellulose Powder (cellulose fibres) and Maize Starch Powder. Both these products are covered under Chapter Heading No.47 as the pulp of this chapter consists essentially of cellulose fibres obtained from various vegetables materials or from waste textiles of vegetable origin. In terms of Chapter Heading 47, pulp is generally presented in baled sheets (whether or nor perforated), wet or dry, but may sometimes be in slabs, in rolls or in the form of powder or flakes. In the present case, Micro Crystalline Cellulose powder is a primary source of cellulose fibres. Micro Crystalline Cellulose powder has been defined under various dictionary which are as under : "As per Wikipedia Meaning and Definition on Microcrystalline'Microcrystalline cellulose: Microcrystalline cellulose is a term for refined wood pulp and is used as a texturizer, a anti-caking agent, a fat substitute, an emulsifier 17 Source : www.fao.org/docrep/w6355e/w6355e01.htm (Food and Agriculture Organization of the United Nations) 20. "Microcrystalline cellulose is a purified, partially depolymerized cellulose prepared by treating alpha-cellulose, obtained as a pulp from fibrous plant material, with mineral acids. The degree of polymerization is typically less than 400. Not more than 10% of the material has a particle size of less than 5 MM.

21. In view of the above published literatures, Microcrystalline Cellulose is a source of Cellulose fibres which is derived from fibrous plant materials (Vegetable origin) and the same has been specified in the HSN Notes under Chapter 47.

22. It is submitted that cellulose powder under dispute was not prepared by treating Cellulose with acetic anhydride, acetic acid, sulphuric acid or nitric acid. And it was not Cellulose Acetate butyrate and cellulose propionate as well as cellulose ethers and therefore, the goods in dispute cannot be classified under Chapter Heading 39 in terms of HSN notes.

23. We place reliance upon decision of C.C.Ex Vs Reliance Cellulose Products Ltd (supra) whereby the Hon'ble Tribunal held that end product being in powder form which is recognized by Notes under Chapter 47 of the HSN, the end product will fall under Chapter 47 and the same will automatically excluded from the ambit of Chapter 39. The Hon'ble Tribunal further held that since the product in that case did not fall under Chapter Heading 39, the Note 6(b) was of no use.

24) We say and submit that Circular No. 32/88 dated 15.12.88 and 6/90 CX dated 19.02.1990 will not be applied in the present case as we did not mix raw materials with hydrochloric acid which can be seen from panchnama dated 28/09.08.2007.

25. Penalty under Section 11AC can be imposed when liability of the duty subsist. In view of the facts and circumstances of the case, Shri Yogesh Dhariyal is not real owner of my firm and therefore, my firm is not required to pay duty on goods manufactured and cleared by my firm. My firm is owned by me and is manufacturing goods independently of M/s. Dhariyal Chemicals and hence the clearances of my firm cannot be clubbed with those of M/s Dhariyal Chemicals for demanding duty. Since there is no liability of duty, penalty under Section 11AC cannot be imposed.

26. I say and submit that Ganesh Enterprise is not liable for payment of interest under Section 11AB as there is no liability of duty in term of the above facts.

27. It is requested that an opportunity of hearing may kindly be given before the case is adjudicated.

Personal Hearing : Personal Hearing in the matter was held on 29.07.11. Shri Hardik Modh, Advocate appeared for the same on behalf of the assessee. He reiterated the submission made in reply dated 28.07.2011 and stated that their appeal was pending before Hon’ble CESTAT against order passed in main SCN and therefore they have requested to keep the matter in abeyance till the direction of Tribunal and that they have nothing more to add

Discussion and Findings: I have gone through the records of the case and the written submission dated 28.07.2011 filed by the assessee.

I find that a show cause notice was issued to the assessee demanding Central Excise Duty amount to Rs. 88,026/- involved on the goods manufactured and removed by them during the period 01.04.2009 to 30.09.2009 by claiming exemption under Notfn. No. 8/2003-CE dated 01.03.2003 for which they were not eligible. It has been observed in the Show Cause Notice that Shri Yogesh C. Dhariyal, the proprietor of M/s. Dhariyal Chemicals was de-facto proprietor of M/s. Ganesh Enterprise, both the factories were not separately entitled to get exemptionfrom Central Excise Duty under Notfn. No. 8/2003-CE dated 01.03.2003 and clearance value to both has to be clubbed for determining their duty liability in terms of Para2(V) of Nofn. No. 8/2003- CE dated 01.03.2003, as amended.

The assessee vide their letter dated 28.07.2011 submitted the reply to show cause notice denying the charges and allegations leveled in the show cause notice. He has stated that Shri Yogesh Dhariyal is not the proprietor of M/s. Ganesh Enterprises and therefore turnover of M/s. Ganesh Enterprise can not be included with the turn over of M/s. Dhariyal Chemicals. I find that a demand in the same issue was confirmed vide OIO No. 48/Addl Commr/09 dated 27.02.2009 which was upheld by Commr. (Appeal) vide OIA dated 07.01.2010. On being challenged by the assessee before the Hon’ble CESTAT, The CESTAT vide order no. A/192/WZB/AHD/2010 & S/158/WZB/AHD/2010 dated 25.02.10 had remanded the order to the Adjudicating Authority for reconsideration of the submission made by the assessee after giving them another opportunity to present their case. Accordingly the Joint Commissioner of Central Excise, Ahmedabad vide OIO No. 33/Jt. Commr/2010 dated 13.12.10 adjudicated the case confirming the demand of duty with interest, confiscating the goods and imposing penalty upon the assessee under Section 11AC of Central Excise Act, 1944, holding Shri Yogesh C. Dhariyal the real proprietor of M/s. Ganesh Enterprise and denying the benefit of exemption under Notfn. No. 8/2003-CE dated 01.03.03 to the assessee.

The assessee in their submission dated 28.07.11 have requested that since the present SCN has been issued based upon the SCN dated 24.08.08 which has been culminated into OIA dated 30.05.11 and they are going to file appeal challenging the OIA, the hearing may be kept in abeyance till the decision of their appeal before the Hon’ble Tribunal.

I find that the present SCN is pending for more than one year and denovo case in the same issue has already been decided by the Joint Commissioner vide OIO No. 33/Jt. Commr/2010 dated 13.12.10, the matter can not be kept pending further and as such the same is taken up for finalizing adjudication proceedings.

I find that in Hon'ble CESTAT the case of Treadwell Rubbers Vs CCE, Mangalore [2007 (212) ELT 551 (Tri.-Bang.)], relying upon the case of Quality Steel Industries Vs Collector [1989 (43) ELT 775 (Tn.), which was also upheld in Apex Court as reported in 1999 (107) ELT A61 (SC)], has interalia held at Para 7 of the order as under:

"We find that the Adjudicating Authority has rightly decided the issues in accordance with the remand order dated 21-1- 2002 of the Tribunal. After examining the Board's guidelines and several case law, he has come to the conclusion that the clearances of M/s. Tradewell Rubbers and M/s. Excel Tyres & Rubber Products should be clubbed. Shri George Kurian is the proprietor of one unit and Smt Annie George is the proprietrix of another unit. They are husband and wife. Smt. Annie George has also given General Power of Attorney to Shri George Kurian. For all intense and purpose, the whole show was being run by George Kurian."

In the aforesaid case, the Tribunal has ordered for clubbing of clearance of both units. In this case, Shri. Yogesh Dhariyal and Shri Ganesh Josh i are cousins. Shri Ganesh Josh' has claimed to given a Power of Attorney to Shri. Yogesh Dhariyal for doing all the work of his proprietorship firm. But, it is established beyond doubt that the entire show was being run by Shri. Yogesh Dhariyal. So, I am of the view that the clearance values of M/s. Dhariyal Chemicals and M/s. Ganesh Enterprise are liable to be clubbed in view of the aforesaid case law also.

In view of the aforesaid facts, evidences and discussion I find that Shri. Yogesh C. Dhariyal was the defacto Proprietor of M/s. Ganesh Enterprise and not Shri Ganesh Joshi. As M/s. Ganesh Enterprise located at Prabhudas Patel Plot No.2, Near Sabar Tiles, Danilimbda, Ahmedabad Shri Yogesh Dhariyal was having two factories under his proprietorship; both factories were not separately entitled to get exemption from central excise duty in view of the specific provisions of Para 2(v) of the Notification No. 8/2003-CE, as amended. Further, I hold that Shri. Yogesh Dhariyal has to be treated as a 'manufacturer' for the purpose of availing exemption under Notification No. 8/2003-CE irrespective of the fact that he was running business/factories in the name of M/s. Dhariyal Chemicals and M/s. Ganesh Enterprise at different places. As per Para 2(i) of the Notification No. 8/2003-CE, a manufacturer has option not to avail the exemption contained in this notification and instead pay the normal rate of duty on the goods cleared by them; such option shall be exercised before effecting first clearances at the normal rate of duty and such option shall not be withdrawn during the remaining part of the financial year. In this case the factory viz. M/s. Dhariyal Chemicals was not availing exemption under Notification No. 8/2003-CE and not eligible for the said exemption. Therefore, M/s. Ganesh Enterprise, which is also under the same proprietorship, was not eligible for the SSI exemption under Notification No. 8/2003-CE.

It is a very clear position of the law that the Proprietor and Proprietary firm are one and same for taxation purpose. The name given to the Proprietary firm is just a name given to the business, but, the legal entity remains the Proprietor only. Therefore, I hold that Shri. Yogesh Dhariyal, M/s. Ganesh Enterprise and M/s. Dhariyal Chemicals all the three are one and same for taxation purpose and they are not different legal entities. I find no force in the contention of Shri. Yogesh Dhariyal to the effect that demand of duty should be made to M/s. Ganesh Enterprise and not to him. In view of the above, I hold that Shri. Yogesh Chandradutt Dhariyal was the real Proprietor of M/s. Ganesh Enterprise and he was not eligible for SSI exemption under Notification No. 8/2003-CE, as amended, for M/s. Ganesh Enterprise. Therefore, he was required to pay Central Excise duty of normal rate, which was not paid by him. Therefore, I find the demand of Central Excise duty made to Shri. Yogesh Dhariyal, Proprietor of M/s. Ganesh Enterprise is to be confirmed under the provisions of Sub Section (2) of Section 11A of the Central Excise Act, 1944. The said unit in their written submission dated 28.07.2011 has contended that the goods cellulose powder manufacture by them are not liable to duty at all as the same is not classifiable under Chapter 39 but is classifiable under Chapter 47 where the rate of duty is nil.

It is not disputed that they are engaged in manufacturing of Cellulose Powder,as far as the classification is concerned. I Have categorically held that it is correctly classifiable under CTH 3912 and not under4704 as claimed by them,as the Cellulose Powder is specifically covered under CTH 3912, Whereas the CTH 4704 Covers only Pulp of Wood or of other Cellulosic Material and does not cover the exclusively cellulose.

Apart from the above, I find that Central Board of Excise & Customs (Board) had occasion to deliberate on the issue of classification of Cellulose Powder. In this regard, the relevant portion of Board's Circular No. 6/90-CX.3, dated 19-2-1990 issued from F. No. 93/5/90-CX.3 is reproduced below:

"Doubts have been expressed regarding the correct classification of Cellulose Powder/micro-crystalline Cellulose Powder, and bleached cotton linters/bleached cotton linter pulp, whether under Chapter 14 or 39 or 47 of CET. It also appears that there is a divergence in practice in the field formation

2. The matter has been examined. The main raw materials for the manufacture of Cellulose Powder/microcrystalline cellulose powder are reported to be bleached cotton linters or hosiery rags or cotton waste or wood pulp- etc. The raw material is mixed with hydrochloric acid and boiled for about 1 to 2 hours and thereafter the material is washed with plain water. It is later semi- dried in a drier, pulverized to fine powder and again dried, The resultant material is Cellulose Powder/micro-crystalline Cellulose Powder. The classification of this product under Chapter 14 is not appropriate inasmuch as it only covers vegetable plaiting materials; vegetable products, not elsewhere specified or included. The classification of the product under Heading 29.42 as "other organic compounds" is not correct. The Heading covers separate chemically defined organic compounds not classified elsewhere. The Cellulose Powder is not a separate chemically defined organic compound as well. It is merely cellulose obtained from out of bleached cotton linters, hosiery rags, wood pulp etc. The classification of the product under Chapter 47 (Heading 47.01) also does not appear to be correct. As per the Chapter Notes under Chapter 47 of HSN, the pulp covered by that Chapter consists essentially of cellulose fibers. Therefore, it is clear that the product which is covered by Chapter 47 is not exclusively cellulose. On the other hand, Heading 39.12 specifically covers "cellulose and its chemical derivatives". As per Explanatory Note under Heading 39.12 of HSN, cellulose, not elsewhere specified or included, in primary forms, is covered under the Heading 39.12. The Cellulose Powder/ microcrystalline Cellulose Powder, which is reported to be in Powder form, would also be covered by the expression "primary form", as per Note 6(b) of Chapter 39 of CET. Therefore, the appropriate classification of Cellulose Powder under Central Excise Tariff would be under Sub- heading 3912.90. In this connection your attentions is also invited to the instructions contained in Board's letter F. No. 93/51/88-CX.3 (Circular No. 32/88), dated 15-12-1988 on the same issue in the context of the old Tariff."

In view of the position stated hereinabove, I do not find any merit in the argument put forwarded by Shri Yogesh Dhariyal and the Cellulose Powder manufactured by him in the factory of M/s. Ganesh Enterprise will fall under Ch.47 and therefore the same is exempted. :

In view of the above fact and discussion, I hold that the said unit has contravened the provisions of Central Excise Rules, 2002 as under: Rule 4: By not paying duty of excise on excisable goods manufactured and cleared by them in the prescribed manner. Rule 6: By not assessing correct amount of duty at the time of removal.

Rule 9: By not obtaining separate central excise registration of M/s. Ganesh Enterprise in as much as it was situated away from M/s. Dhariyal Chemicals and separate registration is required for each factory even though the Proprietor is same. Rule 10: By not maintaining Daily Stock Account records in proper Manner. Rule 11: By removing excisable goods without prescribed invoices. Rule 12: By not filing monthly return in the prescribed form.

Further, I hold that the said unit has wrongly availed the benefit of the scheme of SSI exemption under Notification No. 8/2003- CE, as amended. Further, the said unit has contravened these provisions on account of fraud, suppression of facts and contravention of rules with intent to evade payment of duty, therefore the said unit is liable to penalty under the provisions of Section 11AC of the Central Excise Act, 1944. In the case of UOI Vs. Dharmendra Textile Processors [2008 (231) ELT 3 (SC) - 2008-TIOL-192-SC-CX- LB], the Larger Bench of Hon'ble Supreme Court has held that there is no discretion to reduce penalty under Section 11AC and means rea is not essential ingredient to impose penalty there under. So, penalty equal to duty is imposable in this case.

In view of the above facts and discussion, I pass the following order:

:ORDER: 1. I hold that Cellulose Powder manufactured by M/S Ganesh Enterprise is correctly classifiable under Chapter 39 of the Schedule to the Central Excise Tariff Act.1985 and not under Ch 47 as contended by the said unit 1.

2. I confirm the demand of Central Excise duty payable by Shri Yogesh C. Dhariyal, Proprietor of M/s. Ganesh Enterprise amounting to Rs. 58156/-, Education Cess of Rs. 1163/- and Secondary & Higher Education Cess of Rs. 581/-, totaling to Rs. 59,900/- (Rupees Fifty Nine Thousand Nine hundred only) under the provisions of Sub- Section (2) of Section 11A of the Central Excise Act, 1944.

3. I confirm the demand of interest at the rates prescribed under the provisions of Section 11AB of the Central Excise Act, 1944.

4. I impose a penalty of Rs.59900/- on M/s.Ganesh Enterprise under the provisions of Section 11AC of the Central Excise Act, 1944.

5. In terms of the provisions of Sec.11AC OF Central Excise Act, 1944,where such duty, as determined under sub-sec. (2) of sec. 11A And the interest payable thereon under sec. 11AB of C. E. Act,1944.is paid within 30 days from the date of receipt of this order determinig such duty, the Amt. of penalty liable to be paid by such person under this sec., shall be twenty five per cent of the duty so determined.

Accordingly, Sri Yogesh C Dhariyal, Proprieter of the said unit are given an option to avail the payment of reduced penalty under sec. 11AC of CE Act 1944, subject to the condition that the entire Amt. of duty so determined and confirmed hereinabove alongwith interest at appropriate rate and 25% of duty as penaltyim posed U/S. 11AC of CEA,1944. If the same is not paid within 30 days of receipt of the order the said option will not be available to them and they will be liable to pay the entire amount of penalty,U/S. 11 AC Of the C E Act,1944.

(U B SINGH ) DEPUTY COMMISSIONER, CENTRAL EXCISE, DIV-IV, AHMEDABAD-I

BY R.P.A.D. F.No. V.39/03-21/09-10/Div-IV/DA Date: 29/08/2011

To, M/s. Ganesh Enterprise, Prabhudas Patel Plot No.2, Near Sabar Tiles, Danilimbda, Ahmedabad-

Copy to : 1. The Assistant Commissioner(RRA), Central Excise, Ahmedabad-I 2. The Superintendent ,AR-I, DIV-IV,Ahmedabad-I. 3. Guard File. 9. M/s. Ganesh Enterprises Prabhudas Patel Plot No.2, Near Sabar Tiles, Danilimbda, Ahmedabad are hereby required to produce at the time of showing cause all the evidences upon which they intend to rely upon in support of their defense. They are further directed to indicate in writing whether they desire to be heard in person before the case is adjudicated. If no mention is made about this in their written explanation, it would be presumed that they do not desire a personal hearing.

10. If no cause is shown by them against the actions proposed to be taken within 30 days of the receipt of this notice or if they do not appear before the adjudicating authority when the case is posted for hearing, the case will be adjudicated on the basis of the evidences available on records without any further communication to them.

11. This notice is issued without prejudice to any other action that can be taken against them under the Central Excise Act, 1944 and the Rules framed there under or under any other law for the time being in force.

12. The Documents relied upon are listed in the Annexure A and copies thereof wherever not supplied earlier are enclosed or would be made available for inspection on demand.

ANNEXURE-A

Sr, Description of documents Remarks No. 1 Show Case Notice dated 28.04.2008 was issued from F. Available with the No. IV/13-04/CE/PI-I/07-08/case by the Joint party Commissioner, Central Excise, Ahmedabad-I.

.... The Order - in - Origional No. 48/Addl. Comm./2009 Available with the dated 27.02.2009 passed by the Additional party Commissioner, Central Excise, Ahmedabad-I.

Letter F. No. AR-I/D-IV/Ganesh/2007-08 dated Available with the 1 9 1 1 . 2 0 0 7 and F. No. AR-I/Div-IV/Ganesh/07-08 party dated 11.12.2007 requesting to take new registration for M/s. Ganesh Enterprise and clear the goods on ca ment of duties. 4 Available with the Assessee's letter F. No. GE/GDJ/2008-09/0323/1 dated party 23.03.2009 received in this office on 31.03.2009.

PH Previous

Personal hearing was fixed on 12.05.2009 no one has attended for the same but submitted a letter No. nil dated 09.05.2009 submitted that the Addl. Commr. By an OIO No. 48/Addl. Commr/2009 dated 25.02.2009 confirmed the charge lavelled in the SCN and held that Shri Yogesh Dhariyal is the proprietor of M/s. Ganesh Enterprises. They have not accepted the order passed by the Addl. Commr. As shri ganesh Joshi is the real owner of M/s. Ganesh Enterprises. they have filed an appeal before Hon’ble Commissioner(Appeal),Central Excise,Ahmedabad challenging the said order dated 25.02.2009. As the issue involved in the present metter is identical to the order passed by the Additional Commissioner dated 25.02.2009. Outcome of the Appeal would directly be affected to the present proceedings. In these circumstances they have requested that the hearing of the SCN may kindle be kept in abeyance till disposal of the Appeal for avoiding multiplicity of the proceedings. They have also requested if their requested may not acceded they may be intimated in advance for personal hearing and make further submissions of the SCN. Another PH was fixed on 20.05.2009 no one has appeared for the same. and submitted a letter intimated that, since Shri ganesh Dutt Joshi out of Ahmedabad for attending social function at their native.they are not in a position to attend on 20.05.2009. In these circumstances the PH may be adjourned to any other date after a month. Further PH was fixed on 18.08.2009 again no one attended and intimated vide their letter no. nil dated 17.08.2009 that, as the issue involved in the present matter is identical to the order passed by the Addl. Commr. dated 25.02.2009. Outcome of the Appeal would directly be affected to the present proceedings. In these circumstances they have requested that the hearing of the SCN may kindle be kept in abeyance till disposal of the Appeal for avoiding multiplicity of the proceedings. Once again PH was fixed on 27.08.2009, no one attended the Ph on the date and time fixed.