TaxTMI 
TaxTMI 
2013 (12) TMI 573
X X X X Extracts X X X X
X X X X Extracts X X X X
.... yarn classifiable under sub-heading 5203.00 of the CETA, 1985 without payment of duty under SSI exemption Notification No. 1/93-CE dated 28.2.1993. 3. On 6.3.1996, the Central Excise officers visited the factory premises of the appellant and found two other sheds in the same premises of M/s. Sri Narayana Spinners and M/s. Kadri Mills. By a show-cause notice dated 5.4.1999, it has been alleged that the appellant contravened the provisions of Notification No. 1/93-CE dated 28.2.93 as amended from time to time and cleared the excisable goods without payment of duty by wrongly availing the exemption notification and the value of clearance of both the units i.e. the appellant and Sree Narayana Spinners had to be clubbed for the purpose of ex....
X X X X Extracts X X X X
X X X X Extracts X X X X
....rtnership firm duly registered as per Indian Partnership Act, income tax registration, power connection, bank account, machinery, SSI registration, ESI, registration under TNGST Act etc. She submits that only one partner Shri V. Vasudevan is common in both the firms. It is submitted that they have paid the conversion charge and the rent to the other unit M/s. Sri Narayana Spinners which is shown in the balance sheet. She relied upon the following decisions of the Hon'ble Supreme Court and the Tribunal:- (i) Balsara Hygiene Products Ltd. Vs. CCE - 2012 (278) ELT 526 (ii) Techno Device Vs. CCE - 2009 (243) ELT 79 (iii) CCE Vs. Electro Mechanical Engg. Corporation - 2008 (229) ELT 321 (SC) &nb....
X X X X Extracts X X X X
X X X X Extracts X X X X
....:- (i) Himanshu Traders Vs. CCE - 2012 (278) ELT 223 (ii) CCE Vs. Rasayan Udyog - 2007 (220) ELT 184 (iii) Simplex Expeller Works Vs. CCE - 2001 (138) ELT 678 7. After hearing both sides and on perusal of the records, it is seen that the main contention of the learned counsel is that both the units are separate and independent. She submits the chart as under:- S.No. Nirmal Spinners (Appellant) Narayana Spinners 1. Provisional registration certificate dated 21.12.1994 as SSI with Directorate of Industries Provisional registration certificate dated 18.6.1994 as SSI with Directorate of Industries 2. Certificate of Registration of firms dated 14.7.1995 Certificate of ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ins Nirmal Spinners - supplier Narayana Spinners - job workers 11. Machineries Owned:- 3 carding machinery 1 drawing machinery 1 simplex machinery Machineries owned:- 1 Blowroom machinery 4 Carding machinery 2 drawing machinery 2 simplex machinery 1 winding machinery 8. The Central Excise officers visited the appellant's factory on 6.3.1996. It was found that there are three units namely Sree Nirmal Spinners (the appellant herein), Sree Narayana Spinners and M/s. Kadri Mills. In the present appeal, the first two units are under dispute. Shri Vasudevan, partner of Sree Narayana Spinner in his statement stated that the machines at Shed No. 1 are namely 1 blow room, 4 carding machines and 2 simplex mac....
X X X X Extracts X X X X
X X X X Extracts X X X X
....s presumed the documents were after thought. It is also observed that the agreements were in existence only on paper and the parties did not have intention to implement those agreements. The adjudicating authority clubbed the clearance of finished goods on the ground that the goods cleared were manufactured from a single set of machinery installed in the premises using three different sheds and cleared through the invoice of Sree Nirmal Spinners and Sree Narayana Spinners and hence those clearances are to be clubbed for the purpose of exemption. 10. We are unable to accept the finding of the adjudicating authority. It is evident from the profit and loss account that the appellant paid the conversion charge and a lease rent for use of the....
X X X X Extracts X X X X
X X X X Extracts X X X X
....eld that a single security guard was in charge of security of all units in no way contributed to a finding that clearances of these units could be clubbed. Mutuality of interest, financial integrity among the units are significant factor for clubbing of clearance of units involved. In the case of Balsara Hygiene Products Ltd. (supra), it has been held that clubbing of two units cannot be made on the premise that assessee sold/cleared their entire production to other units. Hence we are of the view that there is no reason for clubbing of both the units. 12. We agree with the submission of the learned counsel that when a show-cause notice proposed for clubbing the value of clearances for two units and notice was issued only one unit and no....