1989 (2) TMI 270

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.... besides imposing a penalty of Rs. 15,000/- under Rules 9(2), 52A, 173Q and 226 of the Central Excise Rules. 2. The brief facts are that the appellants who are manufacturing Ethyle Acetate is a partnership firm and filed declaration on 5-5-1987 with the jurisdictional Superintendent of Central Excise along with a letter stating that they had purchased the firm from the previous management and formed a partnership firm on 24-5-1986 and were manufacturing Ethyle Acetate from May 86 to March 87 and that they did not take out a Central Excise Licence due to ignorance as they were new and requested for issue of a Central Excise Licence and also guide them about the formalities to be followed. The Department gathered information to the effect ....

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....mi and Shri Dinesh Kumar who have sold the firm to the present appellants consisting of its partners Shri Suresh and Prakashchand and purchased the firm on 10-5-1986 from Smt S.G. Subbalaxmi and Shri Dinesh Kumar. On 5-5-1987, the appellants voluntarily filed declaration regarding Ethyle Acetate and requested for issue of licence. Further, according to the learned Counsel, the Collector in his order had unjustly demanded duty from the appellants for the period 1985-86 when they were not at all the manufacturers of the goods. The Department did not pursue any investigations with the previous partners of the firm namely Smt. Subbalaxmi and Dinesh Kumar. The learned Counsel contended that even now the Department was not precluded from proceedi....

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....osition of the Rule and the Act is supported by the provisions of Rule 225 which lays down that if any excisable goods are removed by any person from the place where they are produced or manufactured in contravention of the Rules, the producer of the manufacturer or the licensee shall be held responsible for such removal and shall be liable to be dealt with according to the provisons of the Act or the Rules as if he had removed the goods himself. Therefore, in the present case, the question here is who was the actual manufacturer during the period 1985-86. Surely, the present appellants were not, because they had purchased the firm only on 10-5-1986 which was clearly after the end of the financial year 1985-86. The Collector's reasoning tha....