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TMI Blog1983 (12) TMI 299X X X X Extracts X X X X X X X X Extracts X X X X ..... ppellants under Rule 173Q of the Central Excise Rules, 1944 and demanded duty amounting to ₹ 62,899.21 on the Electrical Laminations cleared during the period from 1-4-1980 to 11-3-1981. He also appropriated the cash security of ₹ 2,300/- furnished by the appellants. 3. The facts of the case are that the appellants manufacture, among other things, ignition coils falling under Tariff Item 68. Electrical stampings and laminations form a component in the manufacture of ignition coils. The appellants obtain these from M/s. Madras Electrical Manufacturing Co. Admittedly the appellants supply cold rolled steel strips with diagrams and specifications to Madras Electrical Manufacturing Company. The Central Excise authorities consider ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assed by the Madras High Court on 6-1-1981 in the matter of Abdul Latif and others v. Asstt. Collector of Central Excise and others. They submitted that the Collector did not consider this case law at all though he took note of the same in his order. They relied on this order and claimed that their case is on all fours with this judgment. According to the appellants, merely supplying raw material to the sub-contractor and getting the finished goods manufactured by him does not amount to the supplier of raw material becoming a real manufacturer. They further submitted that the second Company is an independent unit in itself irrespective of the fact whether the goods are manufactured out of their own material or from the materials supplied by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ase is that the second Company is an independent unit registered under the Companies Act having its own sales tax number and income tax number. They further submitted that the manufacture of stampings and laminations by the second Company is within the knowledge of the Central Excise Department. 11. We have considered with great respect the judgment of the Madras High Court which has been cited by the appellants. In this matter, the petitioners were small scale industrial unit manufacturing goods under Tariff Item 68 of the C.E.T. The raw materials are supplied by the large consumers and the good are made according to the specifications of these large consumers on payment of conversion charges. On behalf of the Government, it was argued ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... adras considered the question of who is the manufacturer while examining the eligibility of some petitioners to the benefits of Notification No. 176 of 77. All the same the relevancy of the judgment to the facts of the present case cannot be ignored. The facts are similar as the appellants too supplied the raw material, etc., to the second Company, who manufactured the goods solely for the appellants. Therefore, we are of the opinion that the appellants have correctly argued that decision of the Madras High Court is applicable to their matter. 13. We have also considered the judgment of the Hon ble Supreme Court [1972 S.C. 780 = 1977 E.L.T. (J 168)]. In this matter, the Asstt. Collector, the Collector and the Central Government held that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Company is a dummy of the appellants. In this context, we respectfully refer to the judgment in Hind Lamps v. Union of India - 1978 E.L.T. (J 78) where it was held that where a manufacturing company sold to agents who purchased the entire production that would not lead to the conclusion that the manufacturing company was a dummy company or that it was not the manufacturer. Similarly, supply of diagrams and specifications or raw material does not amount to becoming the manufacturer unless it is proved that such manufacture is done in the capacity of a dummy company only which is not the case in the instant appeal. 15. In view of this, we accept the appellants submission that the facts in their appeal are on all fours with the judgment o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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