2002 (12) TMI 82 - SC - Central Excise

Summary

Issues involved: Whether the Tribunal was justified in clubbing the production of three interconnected units for the purpose of central excise duty assessment.

The Supreme Court considered the appeal questioning the Tribunal's decision to treat three interconnected units as one for central excise duty assessment. The Tribunal found that the units had mutual interests, shared resources, and common operations, leading to the conclusion that their production should be clubbed together. The appellants argued that they were independent units with only some common facilities for convenience. Additionally, one of the appellants, a limited company, contended that a circular should prevent its production from being combined with the other units. The Attorney General supported the Tribunal's findings of mutual interest among the units based on factual evidence. However, the issue of circular applicability was not raised before the Tribunal, leading to a suggestion for remand for further examination.

The Court agreed with the Tribunal's finding of mutual interest among the units, supported by shared management, procurement, operations, and resources. The interconnected nature of the units was established through various commonalities, leading to the rejection of the appellants' arguments against their inter-relationship. Regarding the limited company appellant's contention based on circulars, the Court noted the need for further examination as the issue was not raised before the Tribunal. Therefore, the matter was remanded back to the Tribunal for a decision on the applicability of the circulars in question.

In conclusion, the Court confirmed the mutual inter-relationship between the units as found by the Tribunal and remanded the appeals for further consideration on the applicability of the circulars. The appeals were allowed for fresh disposal by the Tribunal in accordance with the law, specifically focusing on the limited purpose of circular applicability.