TaxTMI 
TaxTMI 
2015 (8) TMI 98
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....ETH 87169090 and are also trading in Hydraulic Jacks of Trailer and its accessories, manufactured by others/ got manufactured from job workers. That appellant is not having machinery to manufacture complete Hydraulic Jacks for Trailer and different processes are being got done from job workers or from three other small factories owned by the family members of the main appellant. That Shri Nitin G. Vekaria is the proprietor of M/s. Radhika Hydraulics. That value of clearances of the main appellant is less than the exemption limit. 2.1 That on 26.4.2006, officers of Central Excise (AE), Rajkot conducted the search of main appellant's premises and found a certain diaries/ chits. That certain excess stock of raw materials and finished goods were also placed under seizure. That statements of two raw material suppliers of the main appellant were also recorded. That statements of four buyers and two transporters were also recorded to the effect that goods cleared by the main appellant were sent from the premises of the main appellant. That an amount of Rs. 24.32 lakh has been paid by the main appellant during the course of these proceedings. 2.2 It is the case of the Advocate that the m....
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....e of the main appellant. That the concept of manufacture is different in Central Excise and the Income Tax laws. That the seized goods on the date of visit were the Hydraulic Jacks manufactured by job workers/ sister concerns which were brought to the godown of main appellant for embossing brand name before they could be sold. That appellant would also be eligible for cum duty benefit and 25% reduced penalty, which the lower authorities have not extended, in case their submissions on merit are not considered. Learned Advocate also made the Bench go through paras 23 and 24 of the show cause notice dated 17.10.2006 to argue that all the three sister concerns were held to be independent and within SSI exemption limit of Rs. One Crore and that clearances of all these units with the main appellant were not proposed to be clubbed for denying exemption. That similarly M/s. Patel Plastics, M/s. Maruti Agro Industries and M/s. Sardar Agro were held to be within SSI exemption limit as manufacturers. 3. Shri T.K. Sikdar (AR) appearing on behalf of the Revenue argued that as per 3 CD report dated 05.12.2006 filed by the main appellant with the Income Tax department (for the Assessment Year 20....
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.... claim that machines existing in appellants factory and the activities which are possible with those machines. It is observed from the certificate specifically certified by CA that other machining and assembling are not possible in M/s. Radhika Hydraulics. Main appellant also requested before the lower authorities that its manufacturing activity may be assessed by visiting the factory as the same machines, as on the date of Panchnama, are still existing and working. It is observed from the records of the case that lower authorities; instead of making any such verifications based their findings on circumstantial evidences; like intimations filed with Income Tax department and statement of the Proprietor of main appellant and held that main appellant has the capabilities of manufacturing Hydraulic press. The concept of 'manufacture' and 'manufacturer' given in Section 2(f) of the Central Excise Act, 1944 is based on the manufacturing activities undertaken in a factory. But the concept of manufacture under Income Tax law may be regarding income generated by a legal entity which may include the manufacturing activity done himself or also got done from others etc. Therefore, main appell....
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....r-alia, stated that he keeps record of clandestine clearance of all the four firms. In the light of there investigation the correctness of statement dated 26.4.2006 of Proprietor of M/s. Radhika Hydraulics, regarding quantities of clandestine clearances, is questionable. There is no quantification of clandestine clearance and duty liability made by the author of the account, Shri Suresh G. Vekaria, who was keeping the diary. Further, main appellant by a letter dated 15.5.2006 claims that transactions shown in chits/ diaries mentioned at Sr. No. 8, 9 and 10 of Annexure -A to Panchnama dated 26.04.2006 also include transactions of M/s. Patel Plastic Products, M/s. Sardar Agro Industries and M/s. Maruti Agro Industries. The same was considered to be correct by investigation as per Para 7 of the show cause notice dated 17.10.2006 and again Notice No. 2,3,4 and 5 were summoned. In a further statement dated 16.05.2006, Shri Suresh G. Vekaria stated that he maintains the record of clandestine clearance of all the four units including the main appellant. In this regard, it is relevant to observe that main appellant was also getting Hydraulic Jacks manufactured from other 15 job workers as ....