1996 (4) TMI 220 - AT - Central Excise

Summary

Issues involved:
The issues involved in this case are the clubbing of clearances of multiple units, alleged evasion of duty through creation of dummy units, and determination of manufacturing responsibility.

Clubbing of Clearances of Multiple Units:
The appeal contested the order of the CCE, Coimbatore, which had combined the clearances of four units and concluded that the goods were manufactured by the appellant company. The appellants argued that each unit operated independently, with separate locations and transactions, and that no evidence existed to prove that the goods were manufactured by the appellants for the other units.

Alleged Evasion of Duty through Dummy Units:
The department alleged that the other three units were created to evade duty, based on statements indicating common management and operations among the units. However, the appellants refuted these claims, asserting that the units functioned independently and had legitimate business activities, such as purchasing components and engaging job workers for manufacturing.

Determination of Manufacturing Responsibility:
The Tribunal analyzed the evidence presented, emphasizing the need for tangible proof that the goods supplied by the other units were actually manufactured by the appellants. It was noted that if job workers were involved in manufacturing, they should be considered the manufacturers. The Tribunal found insufficient evidence to support the department's claims of evasion and concluded that the demand for duty against the appellants was unfounded, ultimately ruling in favor of the appellants.

This judgment highlights the importance of concrete evidence in establishing manufacturing responsibility and refuting allegations of duty evasion through dummy units.