2001 (3) TMI 210 - AT - Central Excise

Summary

Issues Involved:
1. Clubbing of clearances of different units.
2. Seizure of goods and imposition of penalties.
3. Entitlement to SSI exemption Notification No. 1/93-C.E.

Summary:

Clubbing of Clearances:
The appellants were engaged in the manufacture of oil expellers and parts without Central Excise registration and were availing SSI exemption Notification No. 1/93-C.E. illegally. The Preventive Party discovered that the manufacturing activities were carried out in a common premises with shared resources and common office. The partners in all units were inter se blood relations and virtually belonged to one family. The Deputy Commissioner confirmed the demand of Rs. 5,45,054/- for the period February 1997 to March 1998 and imposed penalties. The Commissioner (Appeals) upheld this order. The Tribunal found that the units were not independent and had common manufacturing activities, thus justifying the clubbing of clearances.

Seizure of Goods and Imposition of Penalties:
During a visit on 16-1-1997, unaccounted goods valued at Rs. 6,37,268.00 involving Central Excise duty of Rs. 95,590.00 were seized. The goods were provisionally released on a bank guarantee of Rs. 1,60,000/-. The Deputy Commissioner ordered confiscation of the goods with an option to redeem on payment of Rs. 1,60,000/- and imposed penalties of Rs. 50,000/- on each appellant u/r 173-Q. The Commissioner (Appeals) affirmed this order. The Tribunal upheld the seizure and penalties, noting that the appellants had common manufacturing premises and activities, and the seizure was justified under the law.

Entitlement to SSI Exemption Notification No. 1/93-C.E.:
The appellants argued that their units were separately located, had different partners, and were independently registered. However, the Tribunal found that the separate registrations were a facade to evade Central Excise duty. The units were not independent as they shared manufacturing activities, premises, and resources. The Tribunal concluded that the appellants were not entitled to the SSI exemption as they did not operate as independent units.

Conclusion:
The Tribunal upheld the orders of the Commissioner (Appeals), confirming the clubbing of clearances, seizure of goods, and imposition of penalties. All six appeals were dismissed as being without merit.