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of <h1>Tribunal emphasizes practical unity over formal separation in dismissing appeals. Legal precedents support decision.</h1> The Tribunal dismissed the appeals, emphasizing the practical unity of the appellants despite their formal separation. The decision was supported by legal ... SSI exemption - Notification no.175/86-CE - eligibility for entitlement to benefit - impugned order has held that these two appellants are not independent units during 2000-2001 and their value of clearances is to be clubbed for deciding on the eligibility of SSI exemption during the said period of 2001-2002 - Held that:- even after April, 2001, there is no change in the ground realities. May be on paper, these two appellants are separate but in practice there is mutuality of interest in each other, which the facts as pointed out in the impugned order makes very clear. The impugned order points out that their separation has been created artificially with an intention to avail the benefit of SSI exemption only. The impugned order points out that the MOU signed between the two appellants does not have vital details. Therefore, we are of the considered view that both the appellants are only one unit for deciding on the eligibility of SSI benefit. These two appellants are two units only on paper but in practice and as per ground realities, they are one business only, which is very much evident and has been clearly pointed out by the Commissioner's impugned order. - Decided against the appellant Issues Involved:- Eligibility of SSI exemption for two appellants- Whether two appellants are independent units- Clubbing of clearances for deciding on SSI exemptionAnalysis:Issue 1: Eligibility of SSI exemption for two appellantsThe appellants challenged the order-in-original that held they were not independent units during 2000-2001 and their clearances should be clubbed for SSI exemption eligibility in 2001-2002. The impugned order stated that one appellant was the main unit and the other was created solely for SSI exemption benefits. The appellants argued their separate registrations, premises, employees, and transactions proved their independence.Issue 2: Whether two appellants are independent unitsThe Tribunal found that despite apparent separation, there was a mutual interest between the appellants to avail SSI exemption. The MOU between them lacked crucial details, indicating an artificial attempt to show independence for exemption purposes. Changes made were cosmetic, with the actual control remaining unchanged. The Tribunal concluded that the appellants were one business entity in practice, emphasizing the significance of ground realities over formalities.Issue 3: Clubbing of clearances for deciding on SSI exemptionRelying on precedents like Bathija Enterprises and Industrial Supplies & Services cases, the Tribunal upheld the clubbing of clearances for SSI exemption entitlement. The decisions from the CESTAT and Supreme Court supported the view that the appellants could not be considered independent businesses for the purpose of the SSI benefit. Consequently, the Tribunal dismissed both appeals based on the discussed facts and legal precedents.In conclusion, the Tribunal dismissed the appeals, emphasizing the practical unity of the appellants despite their formal separation. The decision was supported by legal precedents highlighting the importance of actual business relationships over superficial arrangements for availing statutory benefits.
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