TMI Blog1986 (4) TMI 218X X X X Extracts X X X X X X X X Extracts X X X X ..... the next RT.12 return for the month of April 1979. The mills stopped working in January 1979 on account of financial difficulties and the mills were entrusted to the care of the Court Receiver. The present Appellants, M/s Rajen (Textile) Mills Pvt. Ltd. purchased the mills from the Court Receiver in February 1979 and started the operation of the mill thereafter. They, therefore, filed the first RT. 12 return under their ownership and management for the mills for the month of April 1979. Thereafter, the Central Excise authorities issued a show cause notice dated 22-3-1980 to M/s Rajen (Textile) Mills Pvt. Ltd. asking them to show cause why Central Excise duty amounting to Rs.27,889.86 should not be recovered from them on the quantity of 7,93 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y 1977 till February 1979 when they purchased the mill in auction from the Court Receiver. The Central Excise authorities knew very well that when the mills were auctioned by the Court Receiver the aforesaid quantity of yarn was less in the bonded stock of the mills. The yarn was therefore removed from the mills when it was under the Court Receiver s custody. Hence they contended that they are not liable for the duty on the aforesaid quantity of the yarn. They further contended that the Collector in his impugned order had improperly held that there was a continuity in the licence of the mills and therefore the liability of the previous owners could be transferred to the new owners. They contended that in lieu of the old B-2 bond, the Appell ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he facts of the two appeals was that in the appeal of M/s Estrela Batteries Ltd. the show cause notice for demand of duty had been issued to the earlier management while in the present appeal the demand was made from the new owners. However, there was no dispute about the fact that the quantity of 7,937 kgs. of cotton yarn had been illegally removed from the mills premises between January 1977 and April 1979. But this loss was reflected in the RT.12 return for the month of April 1979 which was filed by the Appellants. Therefore the present Appellants could not disclaim any liability to duty on this quantity of yarn. The Collector had already taken a very sympathetic view and he had not demanded any penalty from the Appellants. The Collecto ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e or any part does not affect the Department s right to recover the duties leviable, if necessary through coercive action by detention of excisable goods, materials, preparations, plant, machinery, vessels, utensils, implements and articles in the custody or possessiosn of the person who succeeds in the business. Therefore, under this law, the Appellants are not saved from the liability of the previous owners. In addition, the learned Senior Departmental Representative has cited the case of M/s Estrela Batteries Ltd., which has been decided in the same manner by this Bench of the Tribunal. The ratio of the decision will also apply in the present case. There is, therefore, not an iota of doubt about the legality of the demand made on the App ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ble to ignore the same. It is also seen on the basis of the contentions contained in the Memo of Appeal that the pilferage of 7,957 kgs. of cotton yarn was known to everybody including the Appellants who bought the mills from the Court Receiver in February 1979 and commenced trial production of the mill in April 1979. The Appeal Memo also mentions that the Central Excise authorities were aware of this loss. There is no denial of this fact on behalf of the Collector of Central Excise, Pune, Therefore, there is no question of the extension of the limitation period to five years as there are no ingredients to sustain such an interpretation. In this view, I find that the demand is time-barred and the appeal has to be allowed on these grounds ev ..... X X X X Extracts X X X X X X X X Extracts X X X X
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