9911796707
TMI Blog1987 (11) TMI 199X X X X Extracts X X X X X X X X Extracts X X X X ..... tton fabrics falling under Tariff Item No. 19 was on specific rate basis. The appellants used to clear their printed cotton fabrics on payment of duty, send them to stitching establishments for converting the fabrics into bed-sheets and pillow covers on job charge basis, pack the bed-sheets and pillow covers in cellophane bags together with printed cardboard folders showing their trade name and Tex Mark and sell them as their products. On 16.3.76, the duties on cotton fabrics became ad valorem. The appellants changed their system of working. Instead of sending The fabrics to the stitchers on their own account, they sold the fabrics to the stitchers. The stitchers thereafter converted the fabrics into bed-sheets and pillow covers. But the ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ain type of folders only. 3. By marshalling the aforesaid evidence, the authorities probably intended to prove that in substance the system of working of the appellants from 16.3.76 remained the same as it was prior to this date. In other words, the appellants continued to be the real manufacturer of the bed-sheets and pillow covers marketed under their brand name and Tex Mark, and showing the stitchers as independent manufacturers of bed-sheets and pillow covers was only a facade. The conclusion arrived at by the Asstt. Collector in the impugned order-in-original is that the stitchers were to be treated as persons employed on behalf of the appellants for the manufacture of bed-sheets and pillow covers. The Appellate Collector has also he ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the contrary - that the appellants allowed the stitchers to use the appellants packing material and brand name free of charge. We fail to see how it follows therefrom that the stitchers were related persons of the appellants. To consider them related persons, evidence is required to show that there was mutuality of business interest between the appellants and the stitchers or that the stitchers were relatives and distributors of the appellants. There is no such evidence brought to our notice. Again, the relevancy of invoking Rule 6 (c) (i) of the Valuation Rules is not understood by us. This rule covers cases where the related person re-sells the goods in retail. Here the stitchers were not re-selling the fabrics but were using them for c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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