[Arising out of OIO-10/COMMISSIONER/RKS/AHD-II/2009, dt.28.04.2009, OIO-01- /COMMR/RAJU/AHD-II/2012, dt.29.03.2012, passed by Commissioner of Central Excise & Customs, Ahmedabad-II and OIA-143/2009-AHD-II-CE/ID/COMMR-A-/AHD, dt. 27/03/2009 passed by the Commissioner (Appeals-I), Central Excise, Ahmedabad]
Brief of the case:
The CESTAT Ahmedabad in the case of M/s Quippo Energy Private Ltd. vs. Commissioner of CE & ST held that the activities carried on by the assessee on imported gensets results into existence of a more functional & operational product catering the needs of industrial consumers which has different use and commercial identity from the imported gensets, would amount to manufacture within the definition of Sec 2(f) of the Central Excise Act, 1944.
Facts of the case:
- M/s Quippo Energy Pvt.Ltd. the assessee (appellant), started business of leasing of power pack on rental basis to their clients. They were importing the Gas Generating Sets comprising of engine coupled with Alternator on common base frame and were paying customs duty under sub-heading 8502.2090 of Customs Tariff Act.
- Assessee after undertaking certain processes cleared the imported goods as Containerized Gensets also termed as Power Pack. They were supplying Power Pack on lease basis to the customers and also providing manpower to operate and maintain the power pack in the customer’s premises.
- On 17.07.2008, the officers of Central Excise (Preventive), Ahmedabad-II visited the assessee’s factory and examined the process undertaken by them. The Assistant Commissioner (Ahmedabad-II) informed the assessee that its activities, would amount to manufacture by virtue of Note 4 and 6 of Section XVI of the Schedule to Central Excise Tariff Act, 1985.
- A Show Cause Notice dated 19.11.2008, was issued by the Commissioner , proposing demand of duty along with interest and to impose penalty on the power pack cleared during the period from November 2006 to July 2008, classifiable under sub-heading 8502.2090 of the First Schedule to the Central Excise Tariff Act, 1985. Similarly, six other show cause notices were issued proposing demand of duty along with interest, to impose penalty and confiscation of goods as already cleared during the said period, on the identical issue, for the period from August 2008 to March 2011.
- Adjudicating the show cause notices , Commissioner raised demands of Rs. 7,08,99,886/- and Rs.3,45,34,494/- and also imposed equivalent penalties under Sec AC of Central Excise Act. Further, penalties of Rs. 2 crore and 1 crore was levied under Rule 25 of Central Excise Rules. Even further, fines in lieu of confiscation of Rs. 4.50 crores and 22lacs were imposed along with a personal penalty of Rs.50,00,000.00 was imposed on Shri Montu Patwa, General Manager (Finance & Accounts ) of the company under Rule 26(1).
- Against such orders of Commissioner, assessee approached before CESTAT, Ahmedabad.
Contention of the Assessee:
