T.S. Thakur, J. - (1.) These appeals under Section 35L(b) of the Central Excise Act, 1944 arise out of orders dated 19th August, 2002 and 8th April, 2003 passed by the Customs Excise and Gold (Control) Appellate Tribunal, West Regional Bench, Mumbai, whereby the Tribunal has set aside the order passed by the Commissioner of Customs & Central Excise, Ahmedabad, confirming the duty demanded from the respondents as also levying penalties upon them under different provisions of the Central Excise Act, 1944. The controversy in the appeals lies in narrow compass, but before we formulate the precise questions that fall for our determination, it is necessary to briefly set out the factual backdrop in which the same arises.
(2.) M/s Solid and Correct Engineering Works, M/s Solid Steel Plant Manufacturers and M/s Solmec Earthmovers Equipment are partnership concerns engaged in the manufacture of parts and components for road and civil construction machinery and equipments like Asphalt Drum/Hot Mix Plants and Asphalt Paver Machine etc. M/s Solex Electronics Equipments is, however, a proprietary concern engaged in the manufacture of Electronic Control Panels Boards. It is not in dispute that the three partnership concerns mentioned above are registered with Central Excise Department nor is it disputed that the proprietary concern is a small SCALE industrial unit that is availing exemption from payment of duty in terms of the relevant exemption notification. M/s Solidmec Equipments Ltd. (hereinafter referred to as 'Solidmec' for short) the fifth unit with which we are concerned in the present appeals is a marketing company engaged in the manufacture of Asphalt Drum/Hot Mix Plants at the sites provided by the purchasers of such plants. It is common ground that Solidmec advertises its product and undertakes contracts for supplying, erection, commissioning and after sale services relating thereto. It is also admitted that all the five concerns referred to above are closely held by Shri Hasmukhbhai his brothers and the members of their families.
(3.) An inspection of the factories of the respondents by a team of officers from Central Excise, Preventing Wing, Headquarters, Ahmedabad, led to the issue of a notice dated 30th November 1999 to the four manufacturing units as well as to Solidmec calling upon them to show cause why the amounts mentioned in the said notice be not recovered from them towards central excise duty. The notice accused the four manufacturing units of having wrongly declared and classified parts and components being manufactured by them as complete plants/systems, even when they were merely parts and components and not machines or plants functional by themselves. The erroneous classification and declaration was, according to the notice, intended to avoid payment of higher rate of duty applicable to parts of such plants and machinery at the material point of time. The notice also pointed out that the units manufacturing parts and components of the plants had availed benefit of exemption wrongly and in breach of the provisions of Rules 9(1) and 173F and other rules regulating the grant of such benefit.;