TaxTMI 
TaxTMI 
2004 (3) TMI 519
X X X X Extracts X X X X
X X X X Extracts X X X X
....d that they had manufactured and cleared diesel engines without payment duty. The penalties were also imposed on the various dealers of M/s. Super Steel Industries on the ground that they had connived with M/s. Super Steel Industries to evade payment of duty. 2. The brief facts of the case are that the appellants are engaged in the manufacture of diesel engines and diesel generator sets and they were manufacturing same under various brand name such as Super Master, Bharat Jyoti, H.M.T. and Usha Star and also under their own brand name. The factory premises of M/s. Super Steel Industries, M/s. Azad Engineering Works and M/s. Single Machinery Store were searched on 6-3-98 and various documents were taken into possession by the Revenue A....
X X X X Extracts X X X X
X X X X Extracts X X X X
....to the Income Tax Department and Income Tax Department made detailed enquiry and dropped the proceedings. During the investigation by the Income Tax Department, the Manager of the co-operative agricultural bank admitted that the utilisation certificates in respect of loans given to the farmers were issued without any verification. The contention of the appellants is that the Revenue had not made any physical verification whether the diesel engines which were financed by the various banks were in existence. The dealers of M/s. Super Steel Industries in reply to the show cause notices, issued to them, denied the allegation and specifically submitted that they had not received any diesel engines without proper documents. The contention of the ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e various documents obtained by the various branches of co-operative agricultural banks and the statements of their employees to say that the various farmers purchased the branded diesel engines manufactured by M/s. Super Steel Industries against the loan advanced by the bank and the number of engines so purchased by the farmers is much more than the manufactured by M/s. Super Steel Industries shown in their statutory records. The documents obtained from the co-operative agricultural banks were not supplied to the appellants nor the officers of the co-operative agricultural banks were allowed to cross examination by appellant in spite of request made. No investigation or verification was conducted by the Revenue Authority in respect of the ....