TMI Blog2009 (6) TMI 918X X X X Extracts X X X X X X X X Extracts X X X X ..... d:- 30-6-2009 - Shri T.K. Jayaraman and M.V. Ravindran, JJ. Shri M.S. Srinivasa, Advocate, for the Appellant. Ms. Sudha Koka, SDR, for the Respondent. ORDER These appeals have been filed against the Order-in-Original No. 10/2007, dated 30-7-2007, passed by the Commissioner of Central Excise, Bangalore. 2. We heard both the sides in the matter. 3. M/s. Ennar Cements Pvt. Ltd. and M/s. Seshashaila Cements Pvt. Ltd. are two mini cement factories engaged in the manufacture and clearance of Portland Cement which are excisable. Both the units are registered with the Department. Detailed investigations were conducted in respect of the units. Based on the investigations, a Show Cause Notice dated 7-9-2006 was issued to M/s. Ennar Cements Pvt. Ltd. and M/s. Seshashaila Cements Pvt. Ltd. proposing clubbing of the value of the clearances of two units together for the purpose of SSI exemption Notification. Further the notice proposed demand of duty and imposition of penalty on the units and also on Shri Sushil Khemka, Managing Director of M/s. Seshashaila Cements Pvt. Ltd. and the Director of M/s. Ennar Cements Pvt. Ltd. The Adjudicating authority confirmed the demand pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng to valuation and which pre-supposes existence of two persons or entities is of no relevance in matters relating to clubbing clearances. Reliance is placed on the ratio of decision in the case of Sapthagiri Cements v. CCE [2005 (183) E.L.T. 385 (Tri.-Bang.)]. (v) It is well settled position that common use of machinery, mutual financial transactions, commonness of partners, etc. cannot be a ground for clubbing in the absence of allegation of common funding, flowback or one of the units being dummy etc. Reliance is placed on the ratio of decision in the following cases :- (a) CCE v. Jagjivandas Co. [1985 (19) E.L.T. 441 which has been upheld by the Apex Court as reported in 1989 (44) E.L.T. A24. (b) Renu Tandon v. CCE [1993 (66) E.L.T. 375] (c) Vivomed Labs Pvt. Ltd. v. CCE [1991 (53) E.L.T. 152] (d) International Dyestuff Mfg. (sic) [1997 (96) E.L.T. 696] (e) Kinjal Electronics [1989 (43) E.L.T. 854] (f) Swastik Engineering Works v. CCE [1992 (62) E.L.T. 313] (g) Super Star v. CCE [2002 (148) E.L.T. 854] (h) Padma Packages (P) Ltd. v. CCE [1997 (90) E.L.T. 175] (vi) The department having alleged that goods manufactured in one factor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lia, clarified that the limited companies, whether public or private, are separate entities distinct from the shareholders composing it and hence, each limited company is a manufacturer by itself and would be entitled to a separate exemption limit. It is not in dispute that M/s. Ennar Cements and M/s. Seshashaila Cements are private limited companies registered separately under the Companies Act and each of them have separate factories. Taking various facts in to account I have already held in my findings on (i) above that the management [of both the units] is one and the same and both the units are not independent to each other, thereby they are to be treated as a single manufacturer having more than one factory. Hence the clarifications given by the Board in the said Circular dated 29-5-1992 are not applicable to the facts of the present case. On perusal of the above findings of the learned Commissioner, it is clearly stated that each appellant s company is separate. In respect of the Board s Circular, the clearances of the limited companies cannot be clubbed. The Commissioner has clubbed it and demanded duty collectively. This is not legal and correct and it is contrary to th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... units and their partners or Directors - Demand ought to have beenconfirmed only against Gajanan Weaving Mills which was the assessee and liable - By confirming the demand upon the seven units, the Collector treated them all as assessees and implicitly recognized their independent existence - Matter to go back to Commissioner of Central Excise, Pune with unlimited remand for de novo adjudication without reference to earlier order of the Collector and Tribunal - Sections 2(f), 3, 5A(1) and 11A of Central Excise Act, 1944 - Rule 7 of Central Excise Rules, 1944. 4. Alpha Toyo Ltd. v. CCE, New Delhi [1994 (71) E.L.T. 689 (Tribunal) SSI Exemption - Clubbing of clearances - Common Managerial Control, a few common directors and advancing of interest free loans by main unit to other units not sufficient to make other units as dummies when they are having independent control or money flowback to the main unit - Clearances not clubbable - Situation not to be confused with that of related person concept under Section 4(4)(c) of Central Excises Salt Act, 1944 - Notification No. 175/86-C.E., dated 1-3-1986 - Section 5A ibid . 5. Renu Tandon ..... X X X X Extracts X X X X X X X X Extracts X X X X
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