Clubbing of clearances requires notice to each projected unit before treating it as a dummy and merging turnover.

In clubbing of clearances, where separate units are projected and the record indicates independent functioning, each allegedly dummy unit must be issued a show cause notice and heard before its clearances are merged with those of the assessee. A unit's genuineness or dummy status cannot be determined without putting that unit to notice when its independent existence is in issue. The Tribunal's remand for fresh notices and de novo consideration was therefore sustained.

---

---

Issues: Whether separate show cause notices were required to be issued to the alleged dummy units before clubbing their clearances with those of the assessee and whether the Tribunal's remand order was justified.

Analysis: The adjudicating authority had recorded material suggesting that one unit was a paper creation and the other had independent indicia of existence. In matters of clubbing of clearances, where the existence of separate units is projected and material shows independent functioning, the Department must put each such unit to notice so that the question of genuineness or dummy status can be examined after hearing all affected parties. The consistent view in tribunal decisions is that failure to issue notice to an independently projected unit vitiates the proceedings when clubbing is sought.

Conclusion: The requirement of issuing show cause notices to all concerned units was upheld, and the Tribunal's direction for fresh notices and de novo consideration was sustained.

Ratio Decidendi: Clubbing of clearances cannot be sustained against a projected separate unit without issuing it a show cause notice and affording an opportunity of hearing where its independent existence is in issue.

---