TMI Blog2018 (10) TMI 635X X X X Extracts X X X X X X X X Extracts X X X X ..... the premises for carrying out the manufacturing activity. From the statement, not supported by any document, the adjudicating authority has vaguely presumed that Shri A. Ganesan has manufactured the impugned goods. The statement given by Shri A. Ganesan does not put forth any evidence that he has manufactured such goods. It is for the department to establish the clandestine manufacture of goods by the appellant. In the present case, the department has failed to draw up panchanama during the date of visit so as to establish that the appellant was manufacturing goods in the premises. Further, there is no evidence to show that he had engaged labourers for manufacture and supply of such huge quantity of goods - the strong probability is that the appellant had procured the goods from job workers for supply to the construction companies. Demand do not sustain - appeal allowed - decided in favor of appellant. - E/239/2009 - 42528/2018 - Dated:- 8-10-2018 - Ms. Sulekha Beevi C.S., Member (Judicial) And Shri Madhu Mohan Damodhar, Member (Technical) For the Appellant : Shri S. Jaikumar, Advocate For the Respondent : Shri A. Cletus, Addl. Commissioner (AR) ORDER ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e adjudicating authority has recorded in the impugned order that there was lacuna in the investigation as establishing the presence of machinery in appellant s premises. 2.4 In para 17 of the impugned order it is stated that department initiated the inquiry based on anonymous complaint dated 06.12.2006 and visited the premises of the appellant. Thought the complaint did mention about 400 mts of material in the premises, as per records no verification of either stock or the activities if any, carried out in the premises was recorded. Yet, the investigation team recorded the statement of A.Ganesan, Proprietor herein on 08.12.20008 wherein he admitted to have manufactured the goods both from the raw material supplied by the customers as well as from the material purchased. The statement is cryptic and does not give much details. The appellant is an illiterate and his statement was written by his employee G.Selvaraj. What the appellant had meant in his statement was that the materials obtained through job workers were supplied to his customers. 2.5 Some of the job workers were examined by the appellant and they deposed that they have done job work for appellant. Department als ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the appellant had actually engaged in manufacture of the said goods at their premises. 2.15 It is a settled principle of law that suppliers of raw materials cannot be held as manufacturers to levy excise duty on the goods manufactured by Job workers. 3. The ld. AR Shri A. Cletus appeared and argued on behalf of the department. He submitted that the contention of the appellant that there were no machineries at the time of inspection by the officers and therefore the allegation that the appellant has not manufactured scaffoldings / propping equipments is without any basis. He submitted that there is no requirement of any sophisticated machinery for manufacturing finished products like scaffoldings / propping equipments. Mere drilling, welding, boring etc. can be done by machineries which are not complex in nature. The appellants would have easily removed the machineries from the premises on coming to know of the inspection that is going to be conducted by the department. The mere fact that the appellant have sold scaffoldings / propping equipments to construction companies like M/s. URC Constructions Pvt. Ltd., M/s. Bharath Constructions, M/s. CCCL, Harinarayanan, Sindhu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fact the goods are manufactured by the job workers. On perusal of records, we find that there is no mahazar drawn up to show that there were any machinery at the premises at the time of inspection. It is also not noted anywhere whether there were raw materials or finished products in the said premises of M/s. Lakshmi Scaff and Vel Scaff on the date of inspection i.e. 8.12.2006. If the department had conducted inspection in the premises, they should have drawn up a mahazar showing the stock of raw materials and finished products lying in the premises. So also the activities carried out in the premises should reflect in the documents prepared at the time of inspection. There is nothing before us to show that there were machines in the premises or raw materials and finished products. The appellants contend that they were only suppliers to the construction companies and the premises were used as godown only. The appellant has furnished a certificate of the concerned Village Officer in which it is stated that the premises does not contain any machinery. The said certificate seen in page 101/102 of the paper book shows that during July 2006 there were no machineries in the building and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of these job workers and their statements having been recorded such evidence cannot be disregarded in toto. They were subjected to cross-examination also. From their statements it is brought out that they were job workers who manufactured the goods. 5.2 The ld. AR has relied upon the statement of Shri A. Ganesan which is reproduced in para 11 of the impugned order. The translated version of the statement does not indicate anything clearly to show that the appellant has himself manufactured the goods. In para 12 of the impugned order, the adjudicating authority notes that no panchanama was drawn on the date of inspection to reflect the activities if any carried out in the premises. The said para is reproduced as under:- Although as per records, the premises was visited by the Departmental Officer on8.12.2006, yet it does not appear whether any pnachanama etc. of the activities carried on in these premises was drawn by the officers. There is no further investigation by the department on this count. 5.3 So also in para 16, it is seen noted that the investigation team had traced many of the job workers out of the 16 job workers given by the appellant. The relevant porti ..... X X X X Extracts X X X X X X X X Extracts X X X X
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