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TMI Blog2016 (1) TMI 150X X X X Extracts X X X X X X X X Extracts X X X X ..... ion no. 1/93-CE the duty liability will arise only against such manufacturer not against two units. If the department recognizes more than one manufacturer clubbing up their turnover is not provided for in the notification. Holding that the SSI units have separate legal existence but turnover has to be clubbed for the purpose of notification no. 1/93-CE is not a tenable legal proposition. There is no clarity on this aspect for the impugned order. There is no supporting evidence for common finance and common management and there is no finding by the original authority that the main appellant has floated, financed and incorporated the SSI units. There is no evidence that the main appellant investing money in SSI units. The main appellant and the other SSI units are limited / Pvt. Ltd. companies respectively and are independent entities irrespective of their Directors / shareholders. We find that there is no evidence that Directors of SSI units are related with M/s. Kores (India) Ltd. as per the provision of Central Excise Act or Companies Act. Merely because common electricity connection was used by both the units by itself will not make it a dummy of one another. Similarly, a co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thority decided the matter afresh and passed the impugned order dated 30.03.2010. 2. The appellants pleaded that the Ld. Commissioner categorically mentioned in the impugned order that M/s. Kores (India) Ltd. and the other 4 SSI units are separate entities. As such, after such finding there is no tenable way for the Department to club the clearances of all these independent units together to arrive at SSI exemption. Further, the duty demand has been confirmed and penalties imposed on the SSI units and appellant separately which itself shows that they are independent and separate entities. The main appellant (M/s. Kores India Ltd.) and the other appellants (SSI Units) are independent entities and have their separate existence as they are registered with various statutory authorities like Registrar of Companies, etc. As per the Companies Act no limited company can be held as a dummy unit as its existence is recognized as a company and there is no question of clubbing its financial business with another entity for tax purposes. The appellant further submits that various dealings between main appellant and other appellants are purely on commercial terms. The renting of premises to S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of notification 1/93-CE dated 28.02.1993. The Hon'ble High Court of Madhya Pradesh vide order dated 17.11.2005 directed the original authority to consider the case of clubbing in the light of the circulars issued by the Board from time to time. The Hon'ble High Court also observed that for the subsequent period Revenue authorities have treated the manufacturing units as separate from petitioners and thus accepted that there is a relationship of buyer and seller between the petitioner and the four manufacturing units without any mutuality. It was also observed that the Adjudicating Authority dropped the proceedings vide order dated 18.03.2005 following the Tribunal's order dated 04.08.2004. 7. We have examined the impugned order closely. The Ld. Commissioner while examining the applicability of Board's circular No. 6/92 dated 29.05,1992 held that the said circular does not debar clubbing of clearance of 2 or more companies if they are having common finance and management. He held the contents of the circular as not applicable to the present case. We find that the Id. Original authority has misdirected himself while considering implication of the Board's circul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Ld. Commissioner confirmed the demand and ordered recovery of duty from the 4 SSI units along with their principal M/s. Kores (India) Ltd. When the demand of recovery was confirmed against these SSI units their identity and separate existence has been recognized. Further, confirming the demand of recovery from the SSI units along with the principal (M/s. Kores (India) Ltd.) indicates ambiguity in the demand to the effect that if there is only one manufacturer in terms of notification no. 1/93-CE the duty liability will arise only against such manufacturer not against two units. If the department recognizes more than one manufacturer clubbing up their turnover is not provided for in the notification. Holding that the SSI units have separate legal existence but turnover has to be clubbed for the purpose of notification no. 1/93-CE is not a tenable legal proposition. There is no clarity on this aspect for the impugned order. There is no supporting evidence for common finance and common management and there is no finding by the original authority that the main appellant has floated, financed and incorporated the SSI units. There is no evidence that the main appellant investing money ..... X X X X Extracts X X X X X X X X Extracts X X X X
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