TaxTMI 
TaxTMI 
2018 (1) TMI 161
X X X X Extracts X X X X
X X X X Extracts X X X X
....othi Woven Bag Industries (herein after referred to as AWBI) Proprietrix Smt. V. Indurani). The said unit was primarily engaged in manufacture of PP/HDPE strips/ tapes and woven fabrics falling under Chapter 39 of the CTA, on their own account as well as on job work basis. Department took the view that in the event of granule supplier not paying duty on woven fabrics/sacks, the earlier removal of strips / tapes from the job work end is covered by Notification No. 83/94-CE dated 11.4.1994 as amended, which is however available only to SSI units manufacturing goods, specified under SSI Notification No. 8/2003-CE dated 1.3.2003. Department took the view that the benefit under notification 83/94 cannot be availed. It appeared that the strips / ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....s however imposed on AWBI (represented by its Proprietrix Smt. Indurani). In appeal, the Commissioner (Appeals) upheld the adjudication order. Hence the appellants are before this Tribunal 2. Today, when the matter came up for hearing, ld. counsel for Shri Raghavan Ramabhadran appearing on behalf of M/s. Palmetto Industries submitted as follows:- 2.1 Appellant entered into agreement dated 01.02.2007 with the four units viz. AWBI, Sath Jothi, Arut Perum Jothi Poly Bag Industries and Arut Jothi Woven Sacks for the purchase of their plant and machinery. AWBI subsequently executed a sale deed dated 17.04.2007 in favour of the appellant for the sale of immovable property viz. factory and shed with electrical installations therein. Similar ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....d. V. Union of India [2016(332) ELT 601 (Guj.)] Lamifab Industries v. Union of India [2015 (326) ELT 674 (Guj.)] Krishna Lifestyle Technologies Ltd. V. Union of India [2008 (229) ELT 173 (Bom.)] affirmed by Hon ble Supreme Court at - 2009 (242)ELT A118 (SC). 2.6 The undertaking given at the time of seeking central excise registration does not ipso facto bind the appellant with the liability which is otherwise not present. The Hon ble Supreme Court in the case of Tata Chemicals v. CCE [2015 (320) ELT 45 (SC)] held that something illegal cannot convert itself into something legal by act of a third person. Reliance is also placed on Dunlop India Ltd. & Madras Rubber Factory Ltd. V. Union of India and Others [1983 (13) E.L.....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... 4. On the other hand, the ld. AR Shri R. Subramaniyan supports the impugned order. He pointed out that after taking over AWBI and other units, M/s. Palmetto Industries had sought for new registration to continue the business from the same premises and based on the letter written from the jurisdictional Deputy Commissioner, they had given an undertaking owning all the existing or future liabilities of AWBI. Hence as per the proviso to section 11 of the Central Excise Act, M/s. Palmetto Industries being the successor unit to AWBI, will definitely have to make good the duty liability demanded. 5. Heard both sides and gone through the records. 6. No doubt, section 11 of the Central Excise Act, 1944 contains a provision which provides for....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ch was on 25.4.2008. Even so, we find that it is not a case where the entire manufacturing activities or business was continued by the new owners. Ld. counsel for M/s. Palmetto Industries has emphasized that they had bought only the plant and machinery from AWBI. He has also placed before us a letter dated 20.8.2007 from M/s. Palmetto Industries to the Assistant Commissioner of Central Excise, Puducherry, they requested for central excise registration, enclosing, inter alia, copy of sale agreements signed by the parties. From the sale agreement, it does not spell out that M/s. Palmetto Industries would be responsible for any central excise dues that may arise in respect of AWBI. We also find merit in the contention put forward by ld. consul....