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TMI Blog2017 (12) TMI 222X X X X Extracts X X X X X X X X Extracts X X X X ..... onal rate of duty @ 9.6% Advalorem (60% of 16%) from the first clearances till the turnover of Rs. One crore and then paid at normal rate of duty @16% thereafter for the period 1.4.2001 to 31.3.2005. With effect from 1.4.2005, they availed CENVAT credit while paying normal rate of duty. Similarly, M/s. Packers India originally availed SSI exemption and thereafter, on taking over the assets and liabilities by the appellant, continued to avail the SSI exemption upto 31.3.2006. It needs to be mentioned that corrugated boxes attracted levy of central excise duty only with effect from 1.3.2001. 2. On scrutiny of records of M/s. AGK Packers and the appellants, it was revealed that the partners of M/s. AGK Packers ShriT. Kumararaj and Shri T. Asokan were also directors of the appellant company. Statements were recorded from both the partners and the partnership deeds as well as the memorandum of association were examined. The department came to the following conclusion:- (i) The profit / loss of the firm was shared only between S/Shri. T. Kumraraj, T. Asokan and S. Gananapraksam during he period from 01.04.2001 to 31.08.2003. to the exclusion of other partners S/Shri. R.Sundararanan, S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ellant-company and also for imposing penalties. After adjudication, the original authority confirmed the demand of Rs. 23,15,664/- clubbing on the clearances and denying the SSI exemption on Packers India for the period 1.4.2001 to 30.9.2003 along with that of the appellant and to recover the same along with interest. Another demand of Rs. 26,49,671/- was ordered to be recovered from the appellant-company for the clearances made by wrongly availing SSI exemption for the period 1.10.2003 to 31.3.2006. A penalty of Rs. 49,65,335/- was imposed on the appellant under section 11AC besides separate penalty of Rs. 2 lakhs under Rule 9(2), 173Q and 226 of the erstwhile Central Excise Rules, 1944. Separate penalty of Rs. 1,00,000/- was imposed on Shri T. Kumararaj and T. Asokan. In appeal, Commissioner (Appeals) set aside the same. Hence, Revenue has come in appeal before the Tribunal. 4. On behalf of Revenue, ld. AR Shri A. Cletus reiterated the grounds of appeal. He submitted that the Commissioner (Appeals) erred in not appreciating the evidences considered by the original authority. The partnership deeds in respect of M/s. Packers India effective from 1.4.2001 was admitted by T. Kamaraj ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the appellant-company. The Commissioner (Appeals) was not correct to accept the plea that it has to be proved that one unit was a manufacturing unit and the other dummy unit where no manufacturing activities were carried out. The department's case is based on the violation of the conditions of the Notification granting SSI benefit. Shri T. Kumararaj and Shri T. Asokan were the real manufacturers in all the three units. 5. As regards applicability of Board's Circular No.C/92 dated 29.5.1992, he argued that the Circular is not applicable and the units having common partners and fictitious partnership deeds cannot take shelter under the above circular. Further, the adjudicating authority had brought out flow of fund between the two units namely M/s. AGK Packers and Packers India during the period 2001 02 and 2002 03. He, therefore, prayed that the order passed by the Commissioner (Appeals) may be set aside and the order passed by the adjudicating authority may be restored. 6. None appeared for the respondents, though notice was issued. The matter is taken up for disposal after hearing the ld. AR and perusal of records. 7. The allegation of the department is that the clearan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has a central excise registration as well as separate bank accounts and Income Tax assessment. Merely because Shri T. Kumararaj and Shri T. Asokan are active partners in M/s. AGK Packers and also the appellant company, it cannot be said that M/s. AGK Packers is a dummy unit of the appellant-company. Needless to say that there is no such allegation or confirmation in the adjudication order that M/s. AGK Packers is a dummy unit. The Commissioner (Appeals) has rightly observed that the department has not produced any documentary evidence to establish that M/s. AGK Packers / M/s. Packers India is a dummy of the appellant company. 9. Another important aspect that has come to our notice is that separate notice has not been issued to M/s. AGK Packers and M/s. Packers India, though the department alleges that these are dummy units. The Tribunal in various cases has taken a consistent view that the dummy unit has also to be put into notice for clubbing the clearances with another unit especially when the element of their independent existence is denied. In the case of Commissioner of Central Excise, Chennai Vs. Urbane Industries reported in 2015 (325) ELT 726 (Mad.), the Hon ble jurisdict ..... X X X X Extracts X X X X X X X X Extracts X X X X
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