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TMI Blog1997 (5) TMI 232X X X X Extracts X X X X X X X X Extracts X X X X ..... and chemical and dairy equipments with the aid of power for manufacturing items under T.I. 68 of the erstwhile Tariff. On the basis of the visits of the Preventive Officers of the Department and the investigations made by them, notice was issued to the present appellants, namely, M/s. Raj Mechanical Industries, Ludhiana charging them with contravention of Section 6 of the Central Excise Act, 1944 and the various Rules for having cleared excisable goods without obtaining Central Excise Licence, for non-payment of duty and for other procedural and substantive violation of the Act and the Rules and for suppressing relevant information with intention to evade payment of duty. 3. The appellants denied the charges by a letter dated 19-7-19 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed, Collector directed the Assistant Collector to determine the exact amount of duty for the year 1983-84. 5. Shri B.B. Gujral, ld. Counsel appeared for the appellants and Shri A.K. Agarwal, ld. SDR appeared for the respondents. 6. Before us the appellants have raised the following grounds : (i) that, though M/s. Raj Mechanical Industries and M/s. Raj Machines were operating from premises which were adjacent, they were different legal entities and each one was registered as a SSI unit with the Government of Punjab and each of them was an independent income-tax and sales-tax assessee. Each of them had its own marketing and sales set up and had separate muster rolls for employees. The Collector's findings that the two firms ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ully aware of the activities of the appellants inasmuch as the appellants had been issued certificates in respect of utilisation of imported raw materials at concessional rates. 6. Appearing for the Department, the ld. SDR submitted that both the firms were in fact a single entity inasmuch as the Partners of M/s. Raj Machines were none other than the wives of the partners of M/s. Raj Mechanical Industries, the present appellants. They were manufacturing the same products, they were sharing the same premises, there was evidence of sharing of the same brand name by both of them, they had been using the same telephone facilities and had also been employing the same workers. They had failed to file declarations under Notification No. 111/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce of financial flow back from one unit to the other, clubbing of clearances of different units having no proprietary interest in each other and registered separately under Income Tax Act, Sales Tax Act and the Central Excise law will not be correct. In the instant case, there is nothing on record to show that there was any financial flow back from the appellants to M/s. Raj Machines or vice versa. The other common facilities and features noted in the impugned order, in our view, cannot in the absence of conclusive evidence of financial flow back sustain allegation of clubbing.
8. In the premises the appeal has to be allowed. Accordingly, the same is allowed and the impugned order set aside. X X X X Extracts X X X X X X X X Extracts X X X X
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