TMI Blog2006 (12) TMI 44X X X X Extracts X X X X X X X X Extracts X X X X ..... oven sacks by two SSI units, namely, M/s. Sisir Enterprises (SE) and M/s. Jelan Industrial Company (JIC), made during 3-6-1998 to 2-11-2000. An amount of Rs. 1,00,53,026/- was demanded towards allegedly ineligible SSI exemption from M/s. Servo Packaging Pvt. Ltd. (SPL) on the ground that the impugned goods had been manufactured by SPL. The Commissioner had also dropped the proposal to recover Modvat credit of Rs 73,50,019/- availed by SE and JIC during the same period and to impose penalties on them and certain others. 2.The appeal is filed on the ground that the Commissioner had not examined in detail all the evidence before arriving at the conclusion, particularly, the fact that Shri Suresh Kumar Jalan, Director of SPL and a partner of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed out that SPL was a Public Limited Company, JIC a partnership firm and SE a proprietorship concern. They were individually registered with Central Excise and had separate manufacturing premises and undertook manufacturing activities. They were separately registered under the Income-tax, Sales Tax, and Central Sales Tax Acts and were duly registered as SSI Units with the Directorate of Industries. They had separate electricity connection, bank accounts and infrastructure for the manufacture of goods and they had filed the prescribed periodical returns/declarations to the department. The department had monitored their activities periodically. They had availed Modvat credit on the strength of proper documents and no discrepancies had been no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e also having Current Accounts at Calcutta, which were operated by the proprietor himself or partners of JIC between 6-7-1998 to 5-1-1999. The operation of account of SE by different authorized persons at Pondicherry and Calcutta should not lead to the assumption that SPL had overall control over SE and JIC. 5.In the case of M/s. Akay Filtips (P) Ltd v. CCE, [2000 (122) E.L.T. 761 (Tribunal)] the facts were that machinery imported by one firm had been installed in the other firm without supporting evidence for its sale or transfer. There were common employees, common directors, common office and common Directors. One Manager operating the bank account of the other firm showed common financial control. These facts had led to the conclusion ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the appellant and nine other units were not dummy units since the units had separate physical premises, machineries, registration with Tax authorities, separate bank accounts etc. (b) Superior Products v. CCE, New Delhi reported in 2002 (144) E.L.T. 187 (Tri. - Del.). In this case it was held that clubbing of clearances was not to be done as both the units had separate capital, premises, machinery, labour etc. Common partners and manager were immaterial. (c) K.A.A. Arunachalam Printing Div. v. CCE, Madurai reported in 2001 (133) E.L.T. 423 (Tri.-Chennai). In this case it was held that clearances of two independent units even having common managerial control could not be clubbed as a single unit. (d) Modi Alkalies Ch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and considered the submissions of both sides. The two units viz. SE and JIC, alleged to be dummies, have separate registration required under Income-tax Act, Sales Tax Act, Central Sales Tax Act, Directorate of Industries etc. They have the necessary infrastructure and electricity connection to manufacture excisable goods and had filed statutory returns and declarations periodically with the department. They were subjected to departmental audit. No evidence has been let in by the department to show that there was any transaction among the three units which could not be termed as commercial in nature or at arms length. There is also no evidence of mutuality of interest between SPL and either of the other two units. Department has treated SE ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... find that the facts in the above cases are different from the facts of the case covered by the impugned order. Further, in Sisir Enterprises v. CCE, Pondicherry the department had proceeded against Sisir Enterprises (SE) for denying the SSI exemption benefit to it and the matter was decided by the Tribunal in its final order reported as 2004 (173) E.L.T. 257 (Tri. - Chennai). In the said matter there were two appeals, one filed by SE and one by JIC against demands against SE JIC denying SSI benefits to them. That itself shows that they were separate legal entities. By doing so, the department has implicitly recognized the existence of SE JIC as independent units, as held by the Hon'ble Supreme Court in the case of Gajanan Fabrics Distr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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