2000 (11) TMI 208 - AT - Central Excise

Appeal Dismissed for Clubbing Clearances of Units due to Lack of Separate Appeals

The Revenue's appeal regarding the clubbing of clearances of five units was dismissed by the Tribunal. The appeal was found not maintainable as other ... Clubbing of clearances - service of show cause notice on partners versus service on firm - maintainability of departmental appeal when all affected units are not impleaded - firm as a separate legal entity for central excise purposes - power to condone delay in departmental appeals under Section 35E(4)Clubbing of clearances - service of show cause notice on partners versus service on firm - maintainability of departmental appeal when all affected units are not impleaded - firm as a separate legal entity for central excise purposes - power to condone delay in departmental appeals under Section 35E(4) - Whether the Department's appeal against only one firm is maintainable when clearances of five units are proposed to be clubbed and show cause notices were not issued to all the firms themselves. - HELD THAT: - Show cause notices in the proceedings were issued to the appellants M/s. Sompura Ceramics and to the partners of the other units; the Tribunal accepted that a firm is a separate legal entity for purposes of the Central Excise Act and, therefore, service on partners cannot be equated with service on the firm. Appeals filed by the Department as against the other units were dismissed as barred by time, the Tribunal relying on the principle that it lacks power to condone delay in appeals under Section 35E(4), as explained in Commissioner of Central Excise, Mumbai v. Azo Dye Chem. Given that the proposed remedy (clubbing of clearances of all five units) affects all firms, an appeal by the Department against only one firm without impleading the other firms is not maintainable; the Tribunal followed its prior rulings in CCE, Mumbai v. Maganlal and Nandlal & Sons and CCE, Mumbai v. M/s. High Land Dye Chem holding similar appeals to be not maintainable where co-noticees were not before the forum. [Paras 3, 4]The appeal by the Department is not maintainable and is rejected.Final Conclusion: The Revenue's appeal challenging clubbing of clearances was dismissed for want of maintainability because co-noticees/firms affected by the clubbing were not impleaded and notices were not properly served on the firms, and the Department's separate appeals against those units were time-barred without power in the Tribunal to condone the delay. Issues involved: Appeal filed by Revenue regarding clubbing of clearances of five units.Summary:1. The Revenue appealed regarding the clubbing of clearances of five units. The appellants argued that the appeal is not maintainable as other affected parties were not heard, and show cause notices were not issued to the firms but to the partners. Appeals against the other units were dismissed as time-barred. The Department filed only one appeal against M/s. Sompura Ceramics, leading to dismissal of appeals against the other units. 2. The Revenue contended that the five units were not independent but were interconnected, created to benefit from exemptions not available individually. They were considered as one unit for clearance purposes, as the other units were deemed dummy units.3. After considering the arguments, it was noted that show cause notices were issued to M/s. Sompura Ceramics and partners of other units. The notice served on partners was deemed invalid as the firm is a separate legal entity. Appeals against the other units were dismissed due to being time-barred. It was held that the issue of clubbing clearances of five units cannot be decided without involving all affected parties, as seen in similar cases.4. The Tribunal concluded that the appeal filed by the Revenue lacked substance, as it did not involve all affected parties. Therefore, the appeal was rejected.