TMI Blog1991 (9) TMI 177X X X X Extracts X X X X X X X X Extracts X X X X ..... r denied the aforesaid benefit stating that both the firms should be considered as a single unit when the clearances of both the units taken together exceeded Rs. 2 Crores for the financial year 1989-90 and hence they are not eligible for the benefit under Notification No. 175/86. The Asst. Collector had also ordered the demand of differential duty with reference to 15% ad valorem fixed by him while finalising the provisional assessments under Rule 9B. Hence the appeals. 3. Appellants contend, inter alia, as under :- (i) Both the firms have separate L. 4 Licence functioning separately and are separate legal entities. Both the firms are being assessed for Sales-Tax and Income-Tax separately. They have been in existence even prior to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndent entities or are to be treated as a single manufacturer while deciding the eligibility for Notification No. 175/86. On examination of the order-in-original I find that Assistant Collector had based his decision mainly on the ratio of Quality Steel Industries v. CCE [1989 (43) E.L.T. 775 (Tri.)]. Unfortunately in this case the facts are altogether different. This is a case pertaining to proprietary firms one owned by the husband and the other owned by the wife who has executed a power of Attorney in favour of the husband and she did not know anything about the operations of the firm. Even the finances were by way of gift from the husband. Hence the CEGAT held in that case that the clearances from both the units are on behalf of one pe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gibility for exemption when Certificate for Registration, Partnership deeds, balance sheets and income tax assessments etc. indicate that the firms are two distinct legal entities. The CEGAT also held that commonness of the partners alone in two firms is not adequate ground to hold one of the units to be a dummy created to evade tax liability. In G.D. Industrial Engineers v. CCE [1983 (14) E.L.T. 1994 (CEGAT)], the CEGAT held that under the law of partnership (although each partner is an agent of all others) the partnership itself is distinct from its partners in terms of Section 3(42) of the General Clauses Act, 1897. Accordingly partner of the firm is not the same person as the firm itself. The CEGAT further held that even if all partners ..... X X X X Extracts X X X X X X X X Extracts X X X X
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