9911796707
TMI Blog2011 (2) TMI 1074X X X X Extracts X X X X X X X X Extracts X X X X ..... Held that:- As decided in MAHYCO SEEDS LTD. [2003 (11) TMI 108 - HIGH COURT OF JUDICATURE OF BOMBAY AT AURANGABAD] raw materials supplier could not be treated as manufacturer under Section 2(f) of the Central Excise Act. Also in the case of Kambatwala [1996 (5) TMI 84 - SUPREME COURT OF INDIA] where in held that goods produced by household ladies in their own premises out of the raw materials supplied by the respondent who paid wages on the basis of number of pieces manufactured - in such cases, the household ladies have to be treated as manufacturer of the goods and the goods cannot be said to have been manufactured on behalf of the respondent. In the instant case, the raw material namely impure carbon dioxide has been manufactured by Vikr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on lease basis and also supplied personnel at the premises of Vikram Ispat. Vikram Ispat sold the entire carbon dioxide to Praxair at a contract price of Rs.431 per kg. whereas M/s Praxair sold the goods subsequently at a higher price. The department was of the view that Praxair are the real manufacturers of the pure carbon dioxide and hence they were liable to pay duty at the price at which they have sold the goods and accordingly two show-cause notices were issued, one demanding differential duty of Rs.43,35,687/- for the period from May to December 2000 vide show-cause notice dated 31.5.2001 and another demanding a differential duty of Rs.50,26,540/- for the period from January 2001 to June 2001 vide show-cause notice dated 1.2.2002. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Therefore, if at all the department wants to demand duty on the value at which Praxair sold the goods, then the department has to establish financial flowback between the two and issued show-cause notice accordingly and they cannot treat Praxair as a manufacturer under Section 2(f). Accordingly, he dropped the proceedings initiated under the show-cause notices. 3. The department is in appeal against the said order on the ground that even though the Commissioner observed mutuality of interest between Praxair and Vikram Ispat, he failed to hold M/s. Praxair as the manufacturer in view of the fact that Praxair has other units manufacturing carbon dioxide and the entire machinery used for the manufacture of carbon dioxide and employee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se rent for the facility equipment, commencing from the date of first sale of CO2 by Vikram Ispat to Praxair from the facility." 6. Similarly 2.1 of the said agreement which deals with operation and maintenance facility also provides as follows- "In view of the complexity and criticality of the technology involved and the expertise required, Vikram Ispat has requested that the facility be operated and maintained by Praxair for Vikram Ispat and Praxair has agreed to do so, on the following terms. Vikram Ispat shall pay appropriate operations charges and Annual maintenance charges, as hereinafter provided to Praxair from the date of first sale of CO2 by Vikram Ispat to Praxair from facility and throughout the term of this agreement." ..... X X X X Extracts X X X X X X X X Extracts X X X X
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