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TMI Blog2016 (1) TMI 194X X X X Extracts X X X X X X X X Extracts X X X X ..... nds to increase their business. The partnership firm planned to supply textile fabrics to the Defence Establishment. The partnership firm furnished the details of partners, address of their factory and manufacturing facility in their registration application dated 6.6.2001 to the DGQAE (Defence Department). The list of plant and machinery was also annexed to the registration application submitted to DGQAE. They also applied for Central Excise Registration vide their application dated 6.6.2001, for processing various varieties of textile fabrics. The appellant vide their letter dated 7.6.2001 submitted an application in form ASP-1 (application for permission to avail the Special Procedure relating to processed textile fabrics) (Rule 97ZAN) t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tenter. The Commissioner held that the processing of drying dyeing cannot be said to be carried out exclusively in a Hot Air Stenter. This was also a ground for rejecting the Special Procedure relating to processed textile fabrics. Accordingly, the Commissioner confirmed demand of duty payable under Section 3 in terms of proviso to Section 11A(1) invoking the extended time period and imposed equivalent penalty under Section 11AC. 3. Heard both sides. 4. Learned Counsel for the appellant opened the arguments by claiming that the extended time period is not applicable in the present case. He referred to their application dated 7.6.2001 in which they applied for the Special Procedure and requested for one chamber stenter to be opened. This l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iscussed at length in the foregoing paras, they appears to have contravened the provisions of Central Excise Act, 1944. Therefore, M/s Shiva Industries, a partnership fir, appears to be non-entitled to avail the benefit of deemed credit under the provisions of clause 7 of the Notification No. 29/96-CE(NT) dated 3.9.1996." The show-cause notice refers to clause (6) of the partnership deed which reads as follows: - "6. That the said Suit Sunita Dodojwala has joined the firm on behalf of M/s Shiva Textile Mills who have independent status and proprietary rights on their assets as per settled terms contained in Annexure-A". 6.3 The conclusion is reached in the show-cause notice that clause (6) of the partnership deed dated 6.6.2001 is nothi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted 2.6.2001 clearly states that M/s Shiva Industries shall not have any proprietary or ownership right of any kind on the plant and machinery of M/s Shiva Textile Mills, but will continue to have their own independent status also. Similarly, M/s Shiva Textile Mills would not have any ownership right on the plant and machinery of M/s Shiva Industries. It is alleged that such partnership deed is contrary to the spirit and provisions of Indian Partnership Act. Reference has been made to Section 14 of the Law of Partnership which states that "The property of the firm; subject to contract between the partners, the property of the firm includes all property and rights and the interest in property originally brought into stock of the firm or acqu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... It does not seem to be established that the partnership firm had proprietory interest in another firm when a legal distinct deed of partnership firm is separate from its partner as an arguable point under Central Excise. Without going into the merits of the case, we find that the department for a long period had not communicated any objection to the information provided by the appellant in June, 2001. There does not appear to be any fact which could not have been verified by the department from the information given by the appellant in June, 01. The information supplied to the Defence Deptt. was for purposes of facilitating overall assessment and registration based on facility/services of vendors. Merely because it was informed to Defence ..... X X X X Extracts X X X X X X X X Extracts X X X X
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