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TMI Blog2016 (7) TMI 234X X X X Extracts X X X X X X X X Extracts X X X X ..... reply furnished by the petitioners and the documents on record. The petitioners are engaged in the business of supply of goods pertaining to electricity transmission. The petitioners claim to do business as traders, whether by causing small quantities of goods to be manufactured on jobwork basis or purchasing the goods from suppliers for ultimate sale to end-users. The petitioners say that they have held themselves out as manufacturers to their purchasers, but that would not imply that the petitioners can be deemed to be manufacturers under the said Act for the purpose of making the petitioners liable to pay excise duty on the goods purchased from suppliers and sold to end-users. In particular, the petitioners complain of the department and the concerned officer having picked on four of the petitioners' suppliers as specimen suppliers and condemning the petitioners as having claimed to have obtained supplies from non-existent parties without referring to the many other suppliers from whom the petitioners claimed to have obtained the supplies. In addition, the petitioners emphasise on the internal report of the department and a report obtained from a private expert to the effect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... concerned commissioner, whether as to their existence or as to the credibility of the documents evidencing transactions between such suppliers and the petitioners, in the order impugned. As to the manufacturing facility at Bellilious Road, there was an internal report prepared by the department on February 8, 2010. The inventory of the machinery and the stocks of goods at the petitioners' premises described a forging machine, a part of a Landis machine and a brick furnace with an electric blower. In addition, some rods and wires and the like were also found available at the Bellilious Road facility. In the "Remarks" column in the inventory prepared by the department, the forging machine was found to have been installed, but "old and covered with dust and filth..."; the Landis machine was found to be uninstalled and "old and covered with dust and filth ..."; and, the brick furnace carried a similar observation. The raw materials discovered at the premises were described as old and rusted. Clearly, when the department's team visited the premises to make an inventory of the manufacturing facility or the raw materials or the finished products thereat, some old and rusted raw material ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been procured by the petitioners in 2014. When there is material on record to suggest otherwise than what is concluded, the contrary conclusion cannot be arrived at by disregarding the evidence and without discrediting the same. That is a facet of the principle of natural justice. It is not enough for a deaf ear to be turned to a citizen in the mechanical observation of the rules of natural justice. A citizen has to be listened to and not merely heard. For the compliance of such rules, what is said by a citizen has to be considered on its content and not merely registered as a sound. The meaningful hearing of a citizen, in such circumstances, would be the appreciation of the evidence contrary to the suspicion of the department that is laid before the decision-making authority. If such evidence is glossed over without being considered or discredited, it amounts to a breach of the fundamental canons of natural justice. Elsewhere in the order impugned, the Commissioner has referred to job-works undertaken by the petitioners, notwithstanding the value thereof not being of any significant proportion. The Commissioner has accused the petitioners of not producing any records or documen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ired, upon their apparent admission, to be independently found to have manufactured the goods in the light of their representation to third parties. For the reasons indicated hereinabove, it was incumbent on the Commissioner to have otherwise come to a cogent finding that the petitioners could be regarded as manufacturers within the meaning of the said Act and found liable to pay the duty. That the petitioners may have misrepresented to their purchasers as to their status may not have been the only relevant consideration for the Commissioner. However, to the extent it is evident from even the submission of the petitioners as recorded in the order impugned that the petitioners may have represented themselves as manufacturers to their purchasers, it is necessary that the petitioners be put on terms and required to make a deposit for the matter to be considered afresh by the concerned Commissioner. Accordingly, WP No.392 of 2016 is allowed by setting aside the order impugned dated December 22, 2015, subject to the petitioners depositing a sum of Rs. 50 lakh with the department within four weeks from date. The order dated December 22, 2015 will remain unconditionally stayed for a pe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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