9911796707
TMI Blog1989 (5) TMI 64X X X X Extracts X X X X X X X X Extracts X X X X ..... ed that one of the items of jute manufactures manufactured by the petitioner at its factory is "laminated jute bags". During the process of manufacture of the said laminated jute bags some bitumen is picked up by the cloth and thereafter the cloth is passed through another roller under pressure and polythene films is pasted on the bituminous side of the cloth. The laminated cloth is then cut to sizes as per the buyer's specifications and sewn into bags. According to the petitioner company various manufacturers who used to manufacture and/or are manufacturing polythene films out of, inter alia, the granules supplied by the petitioner are small manufacturers and the petitioner has been given to understand by them that they are entitled to the various exemptions granted under the various provisions of law to small-scale units. In or about March 1982 the petitioner was allegedly surprised to receive a purported notice to show cause as if the petitioner had manufactured and cleared a quantity of 436776.300 kgs. of polythene films falling under Item No. 15A of the First Schedule to the Central Excises and Salt Act, 1944 without payment of Central Excise duty leviable thereon and without ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... suming though not admitting that any Central Excise duty was payable on the making of polythene films out of duty paid granules by the manufacturers, the petitioner cannot be regarded as the manufacturer in respect of the said manufacturing activities of the manufacturers as per definition given in Section 2(f) of the said Act and the respondent No. 1 and the Central Excise authorities while issuing notices upon some of the manufacturers requiring them to show cause as to why Central Excise duty should not be paid by them on the making of polythene films by them out of granules supplied by their customers including the petitioner cannot proceed against the petitioner also on the same footing by treating the petitioner company as a manufacturer. The allegation of the petitioner is that the notice dated 16-3-1982 has been issued by the respondent No. 1 after the expiry of the period of limitation and the same is wholly illegal, invalid and without jurisdiction. Under Section 11A of the said Act, such notice is required to be issued within a period of six months from the relevant date. The expression "relevant date" has been defined in the said Section 11A to mean, inter alia, in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s in the production or manufacture on his own account. The other allegations made by the petitioner have been controverted by placing on record that provisions of Section 11A(1) is applicable in the instant case and at no relevant time the petitioner company had disclosed the fact of manufacturing the polythene films and it was further submitted that the amount of duty payable by the petitioner company is a huge amount and the acts done and/or caused to have done by the respondents are justified in accordance with law. 4. Mr. Bajoria, learned Advocate appearing on behalf of the petitioner has strongly argued that there is no dispute that the said firms manufacture the films at their respective factories with the help of their own workers and staff and under their own supervision and control. There is no dispute that none of the said firms are in any way related to the petitioner. The petitioner is sought to be treated as a manufacturer simply because it supplied granules to the said films for the manufacture of the films. It is submitted that the petitioner cannot be regarded as the manufacturer of the said films manufactured by the said firms at their respective factories. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tral Excise) and also 1986 (26) E.L.T. 471 (Gonterman Peipers (India) Ltd. v. Additional Secretary to the Government of India). 7.He tried to emphasise upon the point in the instant case that the issues involved are as to the very jurisdiction of the authorities to claim the duty by holding the petitioner as a manufacturer of the said films. The respondents cannot assume jurisdiction by wrongly deciding the jurisdictional fact. The issues are of recurring in nature and regard being had to the facts and circumstances of the case and the provisions of law settled by different High Courts as well as by the Supreme Court, the respondents cannot be permitted to initiate further proceeding on the basis of admitted facts. 8.Mr. Das, learned Advocate appearing for the respondents, has strongly submitted that this Writ Court cannot be converted into a forum of fact finding organ. All the disputed questions of fact cannot be brought to the purview of the Writ Court to determine as to whether the petitioner company is a manufacturer or not. Various evidence are required to be admitted and their probative value have got to be considered at their proper perspective. Since there is a notice to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the case of Ujagar Prints etc. v. Union of India reported in 1988 (38) E.L.T. 535 (S.C.) that in the case of job workers/processing houses, they become liable to pay excise duty not because they are the owners of the goods but because they cause the "manufacture" of the goods. In view of Section 4 and the Central Excise (Valuation) Rules, it cannot be said that the assessable value of the processed fabric should comprise only of the processing charges, because while in one class, of grey-fabric processed by the same processor on bailment, the assessable value would have to be determined differently depending upon the consideration that the processing-house had carried out the processing operations on job-work basis, in the other class of cases, as it not unoften happens, the goods would have to be valued differently only for the reason the same processing house has itself purchased the grey-fabric and carried out the processing operations on its own. It was also found that excise duty is imposed on production on manufacture of goods. This is quite independent of the ownership of goods. Therefore, the value and goods produced on job-work basis, for the assessment under Section 4 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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