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2015 (5) TMI 96 - AT - Central ExciseSSI Exemption - mutual interest - Clubbing of clearances of two companies - Held that:- MBPL for the purpose of determining their eligibility for SSI exemption, and the quantum of SSI exemption, the show cause notice should have been issued to MBPL also, whose clearances are sought to be clubbed with the clearances of the appellant company. But we find that no SCN has been issued to MBPL. In our view on this ground alone the department's case against the appellant company would not be sustainable. Clearances of two or more units can be clubbed for determining their eligibility of the exemption only if those units are owned by the same person. In this case, the evidence relied upon by the Department, at the most indicates the mutuality of interest, but it does not prove that the appellant company and MBPL. are owned by the same person. Moreover, since there is no shareholding of the appellant company in MBPL, on the basis of individual shareholding of the Directors of the appellant company in MBPL, the latter cannot be treated as subsidiary company of appellant company. Similarly, the registered offices of both the companies being at the same address or that plant and machinery of one company having been pledged to the Bank as a security for the loan sanctioned by the bank to the another, by themselves cannot be treated as the evidence that both the units are owned by the same person or that the appellant have all purvasive financial operational and management control over MBPL or vise versa. - even on merits also, there is no justification for clubbing the clearance of the appellant company with the clearance of MBPL for determining the eligibility for SSI exemption of the appellant company. - Decided in favour of assessee.
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