COMMISSIONER OF CENTRAL EXCISE, BANGALORE versus M/S. BRINDA VAN BEVERAGES (P) LTD. AND ORS.

Citation: [2007] 7 S.C.R. 1033 · Decided: 15-06-2007 · Supreme Court of India · Bench: ARIJIT PASAYAT · Disposal: Dismissed
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Judgment (excerpt)

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COMMISSIONER OF CENTRAL EXCISE, BANGALORE 
A 
v. 
MIS. BRINDA VAN BEVERAGES (P) LTD. AND ORS. 
JUNE 15, 2007 
[DR. ARIJIT PASAYAT AND S.H. KAPADIA, JJ.] 
B 
Central Excises Act, 1944: 
Show cause notice-Allegations in, not specific-Moreover, noticee C 
not given proper opportunity to meet a/legations indicated in the notice-
Hence cannot be proceeded against. 
Central Excise Department initiated proceedings against respondent-
assessee relating to availability of exemption under Notification No.175/86 
and 1/93. Commissioner dropped the proceedings holding that respondents D 
were entitled to the benefits under the said exemption notifications. CEGA T 
upheld the order of Commissioner. Hence these appeals. 
Appellant contended that assessee availed the excise exemption 
fraudulently in conspiracy with AMPL and PEL by willfully making a mis-
statement and suppressing correct facts and that since assessee could not 
have availed the benefits, they created dummy concerns to avail the benefits 
and that in the circumstances there was necessity to lift the corporate veil to 
find out the true owners. 
Dismissing the appeals, the Court 
HELD: I. In the show cause notice there was nothing specific as to the 
role of the respondents, if any. The arrangements as alleged have not been 
shown to be within the knowledge or at the behest or with the connivance of 
E 
F 
the respondents. Independent arrangements were entered into by the 
respondents with the franchise holder. On a perusal of the show cause notice G 
the stand of the respondents clearly gets established. (Para 9) (l037-F) 
2. There is no allegation of the respondents being parties to any 
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arrangement. In any event, no material in that regard was placed on record. 
The show cause notice is the foundation on which the department has to build H 
1033 
1034 
SUPREME COURT REPORTS 
(2007) 7 S.C.R. 
A up its case. If the allegations in the show cause notice are not specific and 
are on the contrary vague, lack details and/or unintelligible that is sufficient 
to hold that the noticee was not given proper opportunity to meet the allegations 
indicated in the show cause notice. In the instant case, what the appellant has 
tried to highlight is the alleged connection between the various concerns. That 
B is not sufficient to proceed against the respondents unless it is shown that 
they were parties to the arrangements, if any. As no sufficient material much 
less any material has been placed on record to substantiate the stand of the 
appellant, the conclusions of the Commissioner as affirmed by the CEGAT 
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cannot be faulted. (Para 10111037-G-H; 1038-A-DI 
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C 
CIVIL APPELLATE JURISDICTION : Civil Appeal no. 3417-3425 of2002. 
D 
E 
F 
From the Final Order Nos. 868-876 of 2000 dated 04.05.2001 of the 
Customs Excise, Gold (Control Appellate Tribunal, South Zonal Bench at 
Bangalore in appeal No. /1565-1573/98. 
WITH 
C.A. No. 4398 of2003. 
A. Subba Rao, T.A. Khan, Ajy Sharma and B. Krishna Prasad for the 
appellant. 
Joseph Vellapally, Sr. Adv., Tarun Gulati, Ankit Goyal, R. Chandrachud, 
K.R. Sasiprabhu, M.S. Nagaraja, Praveena Gautam and Pramod B. Agrawal for 
the Respondents. 
The Judgment of the Court was delivered by 
DR. ARIJIT PASAYA T, J .. 1. Challenge in these appeals is to the 
judgment of the Customs, Excise and Gold (Control) Appellate Tribunal, 
Bangalore (in short the 'CEGA T'). By the impugned judgment appeals filed 
by the revenue against the common order of Commissioner of Central Excise, 
G Bangalore (in short the 'Commissioner') was dismissed. The Commissioner 
had dropped tt~e proceedings initiated vide a show cause notice dated 4.5.1995 
relating to availability of exemption under Notification Nos. 175/86 and 1/93. 
2. Background facts, as projected by the appellant are as follows:-
H 
Vide the Show Cause notice, it was alleged that Mis Brindavan Beverages 
Pvt. Ltd., (hereinafter referred to as 'BBPL') who were engaged in the 
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COMMNR.OFCENTRALEXCISE.BANGALORE1-.BRINDAVANBEVERAGES(PlLID.(PASAYAT.J.J }QJ5 
manufacture of aerated water and were the franchise holders to Mis. Parley A 
Exports Ltd. (hereinafter referred to as PEL) in whose brand names they had 
manufactured goods viz., Limca. Thums Up, Gold Spot, had also manufactured 
aerated water in the name and style of Citra which was said to be brand name 
of Mis. Limca Flavours and Fragrances Ltd., (hereinafter referred to as 'LFFL'), 
a holding Company of Mis. P
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