2000 (4) TMI 333 - AT - Central Excise

Summary

Issues: Appeal against clubbing of clearances under SSI Notification and reclassification of spares of rigs.

Clubbing of Clearances under SSI Notification:
The appeal challenged the Order-in-Original that clubbed clearances of two units, arguing they were independently owned by a husband and wife, had separate registrations, and operated in different locations. The appellant contended no power of attorney existed for control over the wife's unit. Citing precedents like Quality Steel Industries and Precision Gears Pvt. Ltd., it was argued that clubbing required evidence of financial flow back, which was absent. The tribunal found no evidence of dummy units, financial flow back, or power of attorney, concluding the order violated natural justice principles by exceeding the show-cause notice's scope.

Reclassification of Spares of Rigs:
The Order-in-Original did not rule on the correct classification of spares due to insufficient evidence and identical duty rates for both headings. The tribunal criticized this approach, stating that lack of evidence should lead to discarding proposed classifications and that identical duty rates do not justify withholding a classification decision. Emphasizing the importance of correct classification over duty rates, the tribunal held the order failed to address the classification issue raised in the show cause notice. Consequently, the order was deemed non-speaking and in violation of natural justice principles.

Judgment:
The tribunal set aside the Order-in-Original and remanded the matter for fresh consideration, directing the original authority to adhere to established case laws on clubbing issues and address the unresolved classification matter. Effective hearing opportunities for the appellants were mandated in the new proceedings, emphasizing the need for expeditious resolution within four months.