9911796707
TMI Blog2006 (12) TMI 408X X X X Extracts X X X X X X X X Extracts X X X X ..... 40/2004-D, dated 14-10-2004. 2. Heard both sides. 3. The relevant facts, in brief, are as follows : (a) The appellant is a processor based at Surat. They have received orders during June, 2003 form M/s. Jhanwar International, 1081, Ambaji Market, Ring Road, Surat, a merchant manufacturer for processing of fabrics. M/s. Jhanwar International who is also a registered dealer with Regn. No. 370404/D/403/2003 in turn placed orders with one M/s. Muskan Prints, L-5, Abhilasha Market, Ring Road, Surat registered dealer No. 370404/D/372/2003 for supply of grey fabrics, who supplied the consignments at the instance of the said M/s. Jhanwar International indicated the appellant as consignee. The supply made was claimed to be out of stock ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e order of the original authority in respect of duty demand and interest and reduced penalty to Rs. 1,00,000/- (Rs. One lakh only). 4. Ld. Advocate for the appellant submitted that there was no allegation that no duty was paid on the raw materials supplied by Muskan Prints; they have no direct dealing with Muskan Prints who had supplied the raw material. They knew the merchant manufacturer M/s. Jhanwar International with whom they had direct links and they had received materials, the invoices and the declarations based on which credit had been taken. Department did not claim that the registration taken by M/s. Muskan Prints was fake. Muskan prints has given necessary declaration to the department. Muskan prints have taken valid and le ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or knowledge about the non-existence of M/s. Muskan Prints? Surprisingly, a copy of the stock declaration said to have been filed by M/s. Muskan Prints was produced by the appellant. As a manufacturer who has taken the credit he is required to know the supplier of raw materials and not merely their merchant manufacturer. It is like a buyer of stolen goods cannot claim ownership of the goods even if he has purchased without knowledge. If he has purchased the stolen goods with the knowledge that they are stolen, then he is liable, in addition, to penal action. Anyway, the appellant, in this case, has taken an undertaking from the merchant manufacturer to compensate him, in the event of credit being found not eligible. Whether this was done ou ..... X X X X Extracts X X X X X X X X Extracts X X X X
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