2017 (11) TMI 978

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....ners in these firms. These firms were separately registered under the Central Excise, having four partners in common in each and paying Central Excise Duty separately. The goods manufactured by them were also different to each other. As per Section 11A of the Central Excise Act, 1944, the duty was to be demanded separately from them because even if it is presumed that the duty was evaded, these two firms were the legal persons who had evaded the alleged duty. It was further held that the allegation of clandestine removal is also not established because the print out taken from the floppies upon which the case is based were not taken before the appellants (respondents herein). Apart from that the Department did not conduct any enquiry from the persons who had or were alleged to have purchased the said goods (clandestinely removed goods). Accordingly, allowing the appeals it was held that the Order-in-Original by the Joint Commissioner is not sustainable and liable to be set aside. 2. The brief facts are:- 2.1. A SCN dated 18/19.05.98 was issued by Assistant Commissioner, Central Excise, Division II, Allahabad against above 07 respondents and (8) M/s Indian Chemical Co., 10, Da....

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....f Rs. 43,521.52/- was also imposed upon them. (ii) The cartons of Himlok Tel, Rahat Lal Tel, Janamghutti, Nurament ointment and Nurament Oil seized on 20.11.1997 valued at Rs. 65,141/- involving C.Ex. Duty of Rs. 5,211.30/- was confiscated with option given to the manufacturer i.e. M/s Rahat Industries to redeem the same on redemption fine of Rs. 6000/-. Duty amount of Rs. 5211.30/- was also confirmed on M/s Rahat Industries and penalty of Rs. 5211.30/- was also imposed. (iii) The demand of Rs. 11,46,479.78/- (as per SCN dated 12.05.99) was confirmed against Mohmd. Azmal Noorani, Smt. Rashida Parveen and their sons Mohd. Ahsan, Mohd. Arshad, Shadab Jamal and Asad Jamal in their individual capacity as well as in their capacity as partners in M/s Rahat Industries and M/s Indian Chemical along with interest and a penalty of equal amount was also imposed upon them under Section 11 AC of the Act. (iv) A penalty of Rs. 2,00,000/- was also imposed upon each partner i.e. Mohmd. Azmal Noorani, Smt. Rashida Parveen, Mohd. Ahsan, Mohd. Arshad, Shadab Jamal and Asad Jamal under Rule 209 A of Central Excise Rules, 1944. 2.4. M/s Rahat Industries, 34, Industrial Col....

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....the respondents, where so manufactured as per directions of Rahat Industries or Indian Chemical Industries and thereafter being clandestinely removed. The common residential premises at 34 Chaitham Lines, Allahabad was the premises were independent manufacturing activity of the goods having brand name of goods manufactured by Rahat Industries or Indian Chemical Industries was being carried out by the respondents. Placing reliance on the ruling in the case of P.M. Abdulf Latif v/s CCE - 1985(22) ELT 758 (Mad.) wherein it is held that the person actually manufacturing the part will be manufacturer. Further, reliance is placed on the ruling in the case of Philips India Ltd v/s Union of India, 1996(86) ELT 263 (Allahabad High Court), wherein it was held that brand name owner will not be manufacturer even if he supplied raw material. Therefore, the Commissioner (Appeals) has erred in holding that the respondents were not the manufacturers in this case. 5. In view of the definition of person as per Section 3(42) of the General Clauses Act, 1897, which reads as under. "(42) Person shall include any company or association or body of individuals, whether incorporated or not". ....

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....stered promises. During the search of the premises some computer floppy and documents were recovered containing details of illicit manufacture and clandestine removal of Noorani Tel, attracting excise duty during the period October, 1994 to 16 May 1996. Further facts on record are that the Department never alleged clandestine removal on the part of the two firms namely Rahat Industries and Indian Chemical Industries. The illicit manufacture of the goods having brand name of these firms and that clandestine removal of the same is alleged to have taken place, from the unregistered premises (residential premises of the respondents). 8. The learned counsel for the respondents Mr. Prabhat Kumar (Advocate) draws my attention to the cross objections filed by the respondents wherein they have categorically stated that there was no allegation in the show cause notices that the respondents were an association of persons. In the absence of such allegation, contention of Revenue is beyond the scope of the show was notice and as such not admissible at this stage. The learned counsel further relies on the findings of the learned Commissioner (Appeals) and states that it have been rightly held....

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....vidence. Accordingly, the learned counsel prays for dismissing the appeal filed by Revenue. 10. The learned counsel further urged that as Indian Chemical Company has been accepted by the Revenue as manufacturer of Noorani Tel and Rahat Industries have been accepted the manufacturer in respect of the other goods found at the residential premises, on the date of search, subsequent determination of liability towards duty on the individuals jointly and severally is not sustainable. It is further urged that the learned Commissioner have rightly held that no clandestine removal is established mainly on the basis of print outs from the floppy disks recovered at the time of search in absence of any further enquiry from the concerned persons or the persons whose names are figuring in the transactions allegedly in the print outs. Accordingly, the learned counsel for the respondent prays for dismissing the appeals by the Revenue. 10. Having considered the rival contentions I find that no attempt have been made to find out the actual manufacturer of the goods seized on the date of search from the residential promises. From the facts on record and the findings of the Adjudicating Authorit....