2016 (1) TMI 150

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....ing taken up together for decision as the issue involved is same. M/s. Kores (India) Ltd. are engaged in marketing of wide range of stationery items like staple pins etc., either manufactured by them or procured from other manufacturers. Certain investigations were conducted by the Department which resulted in the initiation of proceedings against M/s. Kores (India) Ltd. and other appellants in the present case. The case of the Revenue is that the staple pins manufactured by 4 SSI units (Appellants M/s. Mars Stationery Pvt. Ltd., M/s. Neha Stationery Pvt. Ltd., M/s. Nandani Stationery Pvt. Ltd. and M/s, Neptune Stationery Pvt Ltd.) are to be considered as manufactured in one manufacturing facility known as M/s. Kores (India) Ltd., staple pi....

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....stence is recognized as a company and there is no question of clubbing its financial business with another entity for tax purposes. The appellant further submits that various dealings between main appellant and other appellants are purely on commercial terms. The renting of premises to SSI Units, purchase of wire from main appellant by the SSI Units, and such dealings are all purely on commercial terms on recorded transactions. These SSI Units are put up by the promoters over a period of time from September 1992 to August 1995. The appellants further elaborately submitted against the Department's view that the main appellant have financial and administrative control over the SSI units and as such the value for clearances to determine th....

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....financial transactions evidenced by the statements of the various persons in responsibility and the documents support the case of the Department for combining the sale turnover of SSI units. 5. Heard both the sides and examined the appeal records. 6. The point for decision is whether or not the turnover of 4 SSI appellants are to be clubbed together with the main appellant for the purpose of arriving at the turnover to extend the benefit of notification 1/93-CE dated 28.02.1993. The Hon'ble High Court of Madhya Pradesh vide order dated 17.11.2005 directed the original authority to consider the case of clubbing in the light of the circulars issued by the Board from time to time. The Hon'ble High Court also observed that for the....

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....hat the SSI units were not dummy and are having separate existence goes ahead and orders the clubbing of turnover only on the ground of administrative and financial control. Even this administrative and financial control has not been categorically established except for some inferences bases on statements and correspondence. The SSI units in the present case were all independently registered Pvt. Ltd. Companies. Their existence as legal entities have been accepted as a fact by the original authority. Even if it is said that the main appellant is having certain financial and administrative influence over the SSI units, this is not sufficient to club the turnover of all these SSI units. At best it may have the effect on valuation of excisable....

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....y one manufacturer in terms of notification no. 1/93-CE the duty liability will arise only against such manufacturer not against two units. If the department recognizes more than one manufacturer clubbing up their turnover is not provided for in the notification. Holding that the SSI units have separate legal existence but turnover has to be clubbed for the purpose of notification no. 1/93-CE is not a tenable legal proposition. There is no clarity on this aspect for the impugned order. There is no supporting evidence for common finance and common management and there is no finding by the original authority that the main appellant has floated, financed and incorporated the SSI units. There is no evidence that the main appellant investing mon....