9911796707
TMI Blog2007 (8) TMI 544X X X X Extracts X X X X X X X X Extracts X X X X ..... cated at 3, Bansari Apartment, Near Joosar Park, Paldi, Ahmedabad, was visited by the officers on 16-8-1997. On being asked Smt. Pritiben showed office in the cellar of the said premises and informed that there was no manufacturing activity carried on there and this was registered office of M/s. Rasayan Udyog Marketing and that manufacturing was carried on at M/s. Rasayan Udyog Narol s factory premises. After recording statement of Smt. Pritiben the officers visted and searched the premises of M/s. Rasayan Udyog, 318, Bhoomi Textile Compound, Near KTM Textile, Behind Swastik Bansidhar, Narol, Ahmedabad on 17-8-1997. On verification in presence of partner Shri Milanbhai Desai and independent witnesses the officers found stock of certain goods of 2000 kgs. of different chemicals lying near the entrance, the goods were valued at Rs. 83,300/- and the said person informed that his was a godown of M/s. Rasayan Udyog Marketing and no electrical fittings or machineries were found there, the electric meter was found to be closed. Shri Milan Desai informed that they were manufacturing various chemicals and were filing declaration with the department from time to time and in any of the previo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... i, Partner of M/s. Rasayan Udyog and Rs. 80,000/- on Smt. Pritiben Desai, Proprietor of M/s. Rasayan Udyog Marketing u/r 209A of the Central Excise Rules, 1944. 3. The said order of the original Adjudicating Authority was appealed against by the appellants on the grounds that both the units were independent legal entities in the eyes of law inasmuch as they are separately registered under Sales Tax Act, Income-tax Act, etc., that merely because no actual manufacturing activity was found at the premises of Rasayan Udyog Marketing would not mean that there were no goods manufactured in the said unit, that relationship between the owners of the two units was not relevant; that M/s. Rasayan Udyog Marketing was only engaged in dilution of duty paid procured material which activity did not require any machinery and that is why no machinery was found at the premises; that the demand was barred by limitation inasmuch as both were registered with the central excise and filed declarations; that the penalty should not be imposed upon either of them. 4. The above contentions were accepted by Commissioner (Appeals) on the ground that both the units were separately registered as income-tax p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was found for manufacture of textiles auxiliaries; the required machinery is boiler, weighing, scale, carboys, drums etc. In addition to it, in a factory, daily production records, daily issue of raw material, daily production report, stock of raw material, stock of finished goods, muster roll of workers are maintained but no such records was maintained/found there. One meter was fixed at the said place, but there was no wiring or light connection to show that the electricity was being consumed on daily basis for manufacture of goods. During the search it was established that no manufacturing activity were taking place at the said place. For any manufacturing unit, it is necessary to get registration with the Commissioner of Industry or Commissioner of small scale industry or under the Factories Act which prove genuineness of a manufacturing unit. In this case M/s. Rasayan Udyog Marketing did not have SSI certificate or they did not have registration under the Factories Act. Therefore, it is sufficient to prove that no manufacturing unit was in existence and it was only in existence on papers. 3. In the present case M/s. Rasayan Udyog Marketing are having sales tax registration, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... got manufactured from M/s. Rasayan Udyog. There is no retraction to the said statements. The above statements get further corroborated by the fact of non-finding of any machinery required for production in the factory premises of Rasayan Udyog Marketing. Further the trade name used by both the units was same. It is also on record that the letter heads of the both companies and symbol etc. were identical. M/s. Rasayan Udyog Marketing has not been able to show the presence of any factory at the address mentioned in the declarations filed by them with the Central Excise department. All these factors clearly lead to only one inevitable conclusion that all the activities were being done in the premises of M/s. Rasayan Udyog and were being bifurcated in the name of the two units for the purposes of clearances so as to avail the unwarranted benefit of small scale exemption. 8. Much reliance has been placed by the ld. Advocate appearing for the respondents on the decisions of the Tribunal to impress upon it s plea that Revenue has not proved any financial flow back between the two units. Reference has been made on the judgment of High Court of Rajasthan in the case of Renu Tandon v. UOI ..... X X X X Extracts X X X X X X X X Extracts X X X X
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