2014 (6) TMI 684 - AT - Central Excise

Duty demand - Clubbing of demands - Revenue clubbed their clearances in the hands of Kandhari Radio Corporation - Held that - Facts of each case suggest their own fate and characteristics as well as nature thereof for settlement. When there was no job-work agreement, nor there was anything on record to repel the allegations in the show cause notice, we have no other go but to hold that Jeet Enterprises, Hi-Tech Electrical Industries and Kandhari Separators were manufacturers and duty liability in their hands should be determined - Decided against assessee.

Summary

Issues:
1. Clubbing of clearances of different units in the hands of one entity.
2. Determination of liability for duty demand.
3. Existence of job work agreement between units.
4. Dismissal of appeals by Jeet Enterprises, Hi-Tech Electrical Industries, and Kandhari Separators.
5. Decision on Revenue's appeal against clubbing ordered by Commissioner.
6. Outcome of the cross appeals by Revenue.
7. Liability of Hi-Tech Electrical Industries.
8. Liability of Avtar Singh and his partnership.

Analysis:

1. The appeals arose from a common cause where investigation revealed that multiple units were involved in manufacturing goods under the KRC brand. The Commissioner clubbed the clearances of different units with Kandhari Radio Corporation, leading to duty demands. The issue was whether the units should be treated separately or collectively.

2. The Revenue intended to treat the units separately for liability determination. However, the Commissioner clubbed their clearances with Kandhari Radio Corporation without individually determining their liability. The argument was based on the commonality of the manufacturer and the brand name used.

3. The absence of job work agreements or evidence supporting manufacturing on behalf of Kandhari Radio Corporation led to a lack of defense for the units. The law prohibits taking advantage of one's own mistake as a defense, and the units failed to prove their claims.

4. Without job work agreements or evidence to counter the allegations, the Tribunal held that Jeet Enterprises, Hi-Tech Electrical Industries, and Kandhari Separators were manufacturers liable for duty. Consequently, their appeals were dismissed.

5. The Revenue's appeal against the clubbing ordered by the Commissioner was allowed by the Tribunal, disagreeing with the clubbing of clearances in the hands of Kandhari Radio Corporation.

6. Since the appeals by the units were dismissed, the cross appeals by Revenue succeeded, leading to the disposal of all appeals in the manner indicated by the Tribunal.

7. Hi-Tech Electrical Industries was held liable as a manufacturer, and its appeal was dismissed based on detailed reasoning provided by the Tribunal.

8. Avtar Singh, a partner in the group, was not penalized due to the lack of evidence showing a breach of law. The firm faced consequences due to the dismissal of its appeal, while Avtar Singh's individual appeal was allowed.

This comprehensive analysis covers the various issues raised in the judgment, detailing the Tribunal's decision on each matter with respect to the parties involved.