SSI exemption and clubbing of clearances: state-owned factory units may be treated separately where the notification supports independent occupancy.

Where a Government-controlled undertaking operates multiple factories, each unit may be treated as an independent factory for SSI exemption if the exemption notification and its explanation support that treatment. The Tribunal applied earlier decisions in the appellant's own case and Supreme Court guidance on factory ownership and management, holding that the persons managing the factory are the occupier for notification purposes even when the State undertaking is the owner. On that basis, Explanation V to Notification No. 175/86-C.E. was treated as applicable, and the later amendment was read consistently with that interpretation. The individual units' clearances were therefore not required to be clubbed for denying the SSI benefit.

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Issues: Whether the clearances of all units of the State undertaking were required to be clubbed for denying the benefit of Notification No. 175/86-C.E., and whether the explanation inserted by Notification No. 47/88-C.E. applied to treat each unit as an independent factory for SSI exemption.

Analysis: The Tribunal followed the earlier decisions in the appellant's own case and the Supreme Court rulings on the concept of factory ownership and management. It held that even where the Government or a State undertaking is the owner, the persons appointed to manage the factory are to be treated as the occupier for the purposes of the exemption notification. On that basis, Explanation V to Notification No. 175/86-C.E. was held applicable to the units of the appellant, and the later amendment was treated as supporting that interpretation.

Conclusion: The clearances of the individual units were not liable to be clubbed, and the benefit of the SSI exemption was available to the appellant.

Ratio Decidendi: Where a Government-controlled undertaking operates multiple factories, each factory may be treated separately for SSI exemption if the governing notification and its explanation support such treatment, and the clearances cannot be clubbed merely because the undertaking is state-owned.

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