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TMI Blog1988 (10) TMI 148X X X X Extracts X X X X X X X X Extracts X X X X ..... -83 should be taken into account for computing the value of clearances of M/s. Mangalam Paints under Notification No. 80/80-C.E., dated 19-6-1980 as amended and duty, if liable, demanded appropriately. By the impugned order he has also confiscated 25 bags of cement paints with the address of M/s. Super Paints and Chemicals and imposed redemption fine of Rs. 2,500/- in lieu of confiscation. Additional Collector has imposed penalty of Rs. 2,000/- under Rule 9(2), Rs. 1,000/- under Rule 52A, Rs. 2,000/- under Rule 226 and Rs. 10.000/- under Rule 173Q of the Central Excise Rules, 1944 on M/s. Mangalam Paints. He has also imposed a penalty of Rs. 10,000/- on Dr. M.I. Itty, Proprietor, M/s. Super Paints and Chemicals under Rule 173Q. By the present appeal, the appellants have challenged the above order of the Additional Collector. 2. We have heard arguments of Shri P.S. Bedi, Consultant for the appellants and Shri L.C. Chakraborty, J.D.R., for the respondent. Shri Bedi has argued that M/s. Mangalam Paints is a Partnership firm since 1973 in which there are five partners, viz., (i) Smt. Sicily George, wife of Dr. M.I. Itty, (ii) Smt. Mariam Itty Avars, (iii) to (v) Raju M. Itty, Akhil I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... statement of Shri K.P. Xavier clearly shows that M/s. Super Paints and Chemicals did not manufacture cement paint. The entire production of cement paint was, therefore, by M/s. Mangalam Paints. The Additional Collector s order is based on facts and evidence, and confiscation and penalty are fully justified. 4. We have considered the records of the case and arguments of both sides. Additional Collector has given various reasons for holding that cement paint was not manufactured by M/s. Super Paints and Chemicals, but the same was manufactured by M/s. Mangalam Paints. The more important evidence on which his findings are based are as follows :- (i) Indenture dated 5.11.1980, (ii) Statement of Dr. M.I. Itty, (iii) Statement of Smt. Sicily George, (iv) Statement of Smt. Kathrene, (v) Statement of Shri K.P. Xavier, (vi) Various correspondence in the seized files, (vii) Absence of any declaration required under Notification No. 111/78-C.E., by M/s. Super Paints Chemicals. (viii) Statement of K.A. Razak, etc. We find from the copy of the Indenture dated 5-11-1980 entered into between M/s. Mangalam Paints and M/s. Super Paints and Chemicals that in Clause 1 of the Ind ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ls, financial resources and other facilities, but not the facility of manufacturing cement. M/s. Super Paints and Chemicals did not file any declaration required under Notification No. 111/78-C.E. for exemption from Central Excise licence. As per the impugned order, this declaration was to be filed even by the exempted category of manufacturers. No explanation has been given by the firm for not filing the declaration. In her statement dated 19-7-1982, Smt. Kathrene, owner of the premises at Naroth Road, has stated that she has been renting her premises to people for staying and not to any paint company and that she did not know any person by the name Itty . Dr. Itty also stated that he did not know the address of Smt. Kathrene and that there was no rent receipt. Shri K.P. Xavier, an employee of M/s. Mangalam Paint was found cleaning the premises at 32/970, Appollo Road, which was taken by Dr. Itty on rent. He stated that no manufacturing activity was taking place in the premises of M/s. Super Paints and Chemicals. Shri Xavier stated that two bags of cement paint and 34 empty cement bags found in the said premises by the Central Excise Officers were brought from M/s. Mangalam Paint ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... argued that the Indenture dated 5-11-1980 was never acted upon, he has not produced any evidence to show that Indenture was revoked and not acted upon at all. In the show cause notice the Department made a prima-facie case with supporting evidence of Indenture, statements of S/Shri K.P. Xavier, K.A. Razak and Smt. Katherene and various correspondence in the seized file that M/s. Super Paints and Chemicals had not produced any cement paint. The burden of proof, therefore, shifted to the assessees including Dr. M.I. Itty. If M/s. Super Paints and Chemicals actually manufactured cement paint, there could be no difficulty for Dr. Itty, who is looking after the affairs of both the firms, to establish the fact by producing necessary evidence as to how much cement paint was manufactured by the firm during the period in question. No evidence whatsoever has been produced to establish the claim that M/s. Super Paints and Chemicals had manufactured cement paint. Considering the totality of the evidence relied upon and discussed by the Additional Collector in the impugned order, we are unable to accept the contention of the learned Consultant that the impugned order is based on presumption an ..... X X X X Extracts X X X X X X X X Extracts X X X X
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