TaxTMI 
TaxTMI 
2005 (3) TMI 268
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....re to be clubbed together for the purpose of Notification No. 175/86-C.E., dated 1-3-1986, whether M/s. Meghal Enterprises are the related persons in terms of erstwhile Section 4 of the Central Excise Act, whether penalties are imposable on all the Appellants and whether extended period of limitation is invocable for demanding Central Excise duty. 2. Shri B.L. Narasimhan, learned Advocate, mentioned that M/s. Kanchan Industries, a proprietary firm of Shri Ashok Khimavat started manufacturing Mixer - Grinders of Kanchan Brand since January, 1987 and closed down their manufacturing activity of mixer from 30-11-88; that M/s. Neha Industries, Appellant No. 2, a partnership firm of two partners, namely, Ashok C. Khimavat and Dilip Kumar Rai, ....
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....l Enterprises and its distributors and therefore, their dealing were not from principal to principal is not correct and is based on assumption and is against the law enunciated by the Supreme Court in the case of Moped India Ltd. v. Assistant Collector, 1986 (23) E.L.T. 8 (S.C.) wherein it has been held that because the after sale services were provided by the dealer, he cannot be treated as relative not being the relative of manufacturer; that it is wrong to hold that because the advertisement expenses were borne by M/s. Meghal Enterprises they were relative of the manufacturer. He relied upon the decision in the case of Moon Beverages Ltd. v. CCE, Meerut - 2003 (156) E.L.T. 396 (T) wherein it has been held that sharing advertising expense....
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.... in Meghal Enterprises and her husband Shri Ashok C. Khimavat is partner/or proprietor/director in the manufacturing units. She, further, submitted that the dealings were not as principal to principal and were not at arms length as the manufacturing company had not sold their goods to any other party, except a few instances in May, 1987 which is very negligible compared to total sale; that even after the goods reached Meghal Enterprises, they were known in the market as those of Kanchan Industries; that Meghal Enterprises had not marketed any other similar goods, i.e. mixer grinders; that moreover the price list of Meghal Enterprises was circulated under the letter head of Kanchan Industries. She contended that mutuality of interest is esta....
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....assessee has an interest, direct or indirect, in the business of the person alleged to be a related person nor is it enough that such peson has an interest, direct or indirect, in the business of the assessee. In the case of UOI . v. Atic Industries Ltd., 1984 (17) E.L.T. 323 (S.C.), the Supreme Court has held that each of them must have direct or indirect interest in the business of each other. In the present matters, the mutuality of interest has been presumed by Revenue on the basis of sale of entire production by the manufacturing units to M/s. Meghal Enterprises on the basis of mutually agreed price, the goods were known in the market to be those of Kanchan Industries, price list was circulated on the letter head of Kanchan Industries ....