9911796707
TMI Blog2009 (7) TMI 935X X X X Extracts X X X X X X X X Extracts X X X X ..... e product was entirely by M/s. Tristar Beverages Pvt. Ltd. and not by the appellants who were merely marketing the said product and were assisting the said company by procuring the raw material for the manufacture of final product and secondly, on the ground that the records reveal no justification for invocation of extended period of limitation and hence on the principle of bar of limitation also, the demand cannot be sustained. 2. While elaborating the case of the appellants the learned advocate appearing for the appellants submitted that the appellants merely supplied the raw material to the said company namely, Tristar Beverages Pvt. Ltd. The appellants did not have any control as such on the manufacturing process and that is apparent from the terms and conditions incorporated in the agreement between the parties which were totally ignored by the authorities below while arriving at the finding about the liability of the appellants towards the excise duty under the Central Excise Act, 1944. He further submitted that since the appellants were not manufacturers of the product, there was no obligation upon the appellants to submit ER 1 returns and therefore, no adverse inference ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t between the parties discloses that the entire raw material and packing material with the necessary specification regarding the manufacture of product was procured by the appellant-company and also had undertaken to do the packing of the material as well as supply of raw material and assurance from Tristar Beverages Pvt. Ltd. to indemnify the appellant in case of any action or any harm to the appellants which the appellants may suffer as a result of Tristar Beverages Pvt. Ltd. failing to comply with any of the statutory requirements in relation to the obligation of Tristar Beverages Pvt. Ltd. under the agreement between the parties. Drawing our attention to the impugned order, he submitted that adjudicating authority had on analysis of the materials on record has clearly arrived at the finding that as the raw materials were purchased by the appellants and after getting them processed from their job worker, the processed goods were received back by the appellant and then finished goods were sold by them from their factory under their own invoices and that they were the actual manufacturers. Further, no material has been pointed out to counter the said finding arrived at by the auth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... goods but because they cause the manufacture of the goods. The dimensions of the Section 4(1)(a) and (b) are fully explored in a number of decisions of this Court. Reference may be made to the case of Bombay Tyres International. Consistent with the provisions of Section 4 and the Central Excise (Valuation) Rules, 1975, framed under Section 37 of the Act, it cannot be said that the assessable-value of the processed fabric should comprise only of the processing-charges. This extreme contention if accepted, would lead to and create more problems than it is supposed to solve; and produce situations which could only be characterised as anomalous. The incedence of the levy should be uniform, uniformed by fortuitous considerations. The method of determination of the assessable value suggested by the processors would lead as to the untenable position that while in one class of Grey-fabric processed by the same processor on bailment, the assessable-value would have to be determined differently dependent upon the consideration that the processing-house had carried out the processing operations on jobwork basis, in the other class of cases, as it not unoften happens, the goods would have ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... heets etc. and instructions in relation to the production are to be communicated in writing to Tristar Beverages well in advance and in any case a minimum of 10 days advance notice should be given before taking production. It is the responsibility of appellants to verify and confirm quality of the raw material as well as for the packing material. Clause 3.7 provides thereto that the final liability regarding raw material/packing material and specifications thereof would rest with the appellants. Clause 3.9 provides that the appellants undertake to cover the packing material procured and raw material supplied by the appellants and finished products under relevant insurance policies to take care of the possible losses. The cost of insurance shall be reimbursed by the Tristar Beverages to the appellants. The liability of Tristar Beverages shall be till the time of delivery of the goods. In clause 4.1, Tristar Beverages has undertaken to indemnify the appellants in all possible manner for any action, claim or harm that the appellants may suffer or face as a result of Tristar failing to comply with any statutory requirements those are necessary under the laws in force during subsistence ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ith. Undoubtedly this is prima facie finding for the purpose of deciding the stay application. 12. As regards the point relating to the invocation of extended period of limitation, the contention that the appellants were not bound to inform about the manufacture or supply of raw material to the Tristar Beverages to the Department or that it was not necessary to disclose the fact about the manufacture of the product in question in ER 1 returns by the appellants, prima facie, we find that the manufacture of the product was by the appellants, and therefore, the said contention cannot be accepted. It was also sought to be contended that appellants were not aware that it would require to be informed in spite of the fact that the actual manufacture was through the job workers. In the facts and circumstances of the case as already noted above it is difficult to accept this contention also. 13. The principle of law that non-disclosure of information which the assessee is not legally required to disclose would not amount to suppression cannot be disputed but the said proposition has no application to the facts of the case in hand and therefore the decision of Gufic Pharma is of no help ..... X X X X Extracts X X X X X X X X Extracts X X X X
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