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TMI Blog1988 (7) TMI 61X X X X Extracts X X X X X X X X Extracts X X X X ..... ch agreement, gave to the petitioner leave, and licence to use the powerlooms and to operate a powerloom factory. The agreements provide that the petitioner would be in charge of the entire management and working of the power-looms. He alone would purchase yarn and other stores, spares and accessories. He would manufacture textiles. The property in the goods would vest in the petitioner. The petitioner also had the right to dispose of these goods. Under the agreements, the owner had no right, title or interest in the goods so manufactured. The petitioner was merely required to pay a certain monthly compensation to the owner of the powerlooms. 2. As a result of these agreements the petitioner obtained full use and control of 22 powerlooms ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... our powerlooms were not registered with the Textile Commissioner, and there was no valid Central Excise Licence in respect of these four powerlooms. 4. In exercise of powers under Rule 96(j) of the Central Excise Rules, 1944 the Central Government by a notification bearing No. 41/65, dated 28.2.1965 has laid down rates of excise duty to be paid in respect of cotton fabrics produced on powerlooms. The rates are based on the number of powerlooms installed by or on behalf of a person in one or more premises for the manufacture of unprocessed cotton fabrics. Under the table initially prescribed, where four or less than four powerlooms are installed, the rate of duty payable per year per powerloom is 25 rupees; where more than four, but not mo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Bombay Central Excise division intercepted a tempo loaded with 11 packages. The 2nd petitioner was accompanying these packages. He claimed to be the owner of the packages and stated that these packages contained powerloom cotton fabrics manufactured by him on twenty-two powerlooms situated at Goregaon (East), Bombay-400 063. Thereafter investigations took place and it was discovered that the petitioner was manufacturing cotton fabrics on twenty-two powerlooms without these powerlooms being registered in his name with the Textile Commissioner and without a valid Central Excise licence in his name. It is not necessary to go into the various proceedings which took place against the petitioner in detail. 8. The petitioner was served with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 85 of 1981. In the meanwhile the petitioners have also filed a revision application. The learned Single Judge directed the respondents to dispose off the revision application within six weeks on merit. Accordingly, the revision application was disposed off by an order dated 18th September, 1981. Under this order the other particulars of the original order of the Collector were upheld. It was, however, held that the Collector had ordered recovery of duty at enhanced rate but had not specified the rate or amount of enhanced levy. To this extent the order was incomplete and vague. The Government therefore remanded the case to the Collector of Central Excise for a de novo adjudication on the limited question of fixing the duty liability of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 96I, 96J and 96K, Rule 9 sub-rule (2) cannot be applied to him. The levy of enhanced duty is in excess of powers under Rule 9(2). Hence the order levying enhanced duty is bad in law. This submission is misconceived. AR 6 forms under Rule 96K are signed by the petitioner only as the authorised agent or licensee of the "manufacturer". The owners of the powerlooms are not the manufacturers of cotton fabrics. It is the petitioner who is the manufacturer of cotton fabrics. Hence the petitioner has not cleared the goods in accordance with the relevant rules of removal under the Central Excise Rules. The petitioner has not applied for permission to avail of the provisions of the relevant rules nor has cleared the goods under the rules in question. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the petitioner that the respondents were aware of the leave and licence agreements between him and the owners. He was allowed by the respondents to clear the goods. The submission also cannot be accepted. Leave and licence agreements were not known to the respondents. They were only produced after the show cause notice was issued. The respondents came to know about the manufacturing activity of the petitioner only when the tempo containing the goods manufactured by him was intercepted on 17th September, 1976. 18. The only part of the order challenged in this petition relates to calculation of duty at its enhanced rate. This challenge fails for reasons set out above. In the result the petition is dismissed and the rule is discharged w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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