ISPL INDS. LTD. Vs. COMMISSIONER OF C. EX.

JUDGEMENT

(1.) These 7 appeals have common facts and arise out of the same order. They are therefore being disposed of vide this common order.

(2.) M/s. ISPL Inds. Ltd. manufactured excisable goods from their factory in Thane. This activity was stopped in 1983. M/s. Uchit Investments and Traders P. Ltd. was a factory which came in existence in 1982. M/s. Vishrut Investments and Traders Pvt. Ltd. was a factory which came in existence in 1984. Excisable goods were not manufactured by M/s. ISPL Inds. Ltd. but by M/s. Vishrut and Uchit. There were no formal agreements entered into, but that the goods were got manufactured on job work basis. The raw materials were supplied by M/s. ISPL Inds. Ltd. and the goods were despatched to M/s. ISPL Inds. Ltd. or to their customers. The two job workers, M/s. Vishrut Investments and Traders Pvt. Ltd. and M/s. Uchit Investments and Traders Pvt. Ltd. had their own registrations under the Central Excise law as well as under other laws such as Shop and Establishment Act etc. These two units filed declarations from time to time and availed concessional rates of duty in terms of the exemptions available to units in small sector.

(3.) Show cause notice issued on 14 -5 -1990 alleged that M/s. ISPL themselves were the manufacturers. It was alleged that the creation of M/s. Vishrut and M/s. Uchit and their separate existence were myths. The liability to duty was fastened upon M/s. ISPL. It was alleged that M/s. Vishrut and M/s. Uchit were not job workers but were hired labour. In this belief demand of Rs. 71, 74,842.28 from was raised on M/s. ISPL. The Modvat credit availed of by M/s. Vishrut and M/s. Uchit was sought to be reversed. Allegations as to penalty were made against the three units as well as against four individuals. They were Niranjan Shah, Managing Director of M/s. ISPL Inds. Ltd., M.B. Joshi, Assistant Manager of M/s. ISPL, B.U. Desai, Manager of M/s. Vishrut Investment and Traders and S.S. Shah, Managing Director of M/s. Vishrut Investment and Traders Pvt. Ltd. as also of M/s. Uchit Investment and Traders Pvt. Ltd. The Commissioner after hearing the concerned persons confirmed the demand, directed recovery of Modvat credit without specifying the quantum thereof and imposed penalties on all the seven no -ticees. Hence the present appeals.