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2015 (12) TMI 232 - ALLAHABAD HIGH COURT

2015 (12) TMI 232 - ALLAHABAD HIGH COURT - 2016 (331) E.L.T. 589 (All.) - SSI exemption - Availment of concessional rate as per Notification No.7/97-CE dated 1st March, 1997, Notification No.38/97-CE dated 27th June, 1997, Notification 9/98-CE dated 2nd June, 1998 and Notification No.9/99-CE dated 28th February, 1999 - Clubbing of clearances - Held that:- Manufacturer is entitled for exemption if the aggregate value of clearances of all excisable goods for home consumption from one or more facto .....

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of duty if the aggregate value of clearances of all excisable goods does not exceed ₹ 3 crores. Since the appellant has another factory, which is manufacturing an excisable commodity, its clearances have to be added while considering the exemption notification. Since the aggregate clearances exceeded the limit of ₹ 3 crores, the appellant was not entitled for exemption. The adjudicating authority rightly issued the show cause notice and quantified the demand. - Decided against assess .....

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2nd June, 1998, 28th February, 1999 and 1st April, 1999 mentioning therein that they are a small scale industry unit and would therefore, be availing excise duty at concessional rate as per Notification No.7/97-CE dated 1st March, 1997, Notification No.38/97-CE dated 27th June, 1997, Notification 9/98-CE dated 2nd June, 1998 and Notification No.9/99-CE dated 28th February, 1999. On scrutiny of the records, the department noticed that the appellant M/s Premium Suitings (P) Ltd. (Chemical Divisio .....

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learances had to be clubbed together for the purposes of granting the benefit under the notifications. Accordingly, seven show cause notices were issued to the appellant for different periods proposing a total demand of duty of ₹ 4,04,171/- along with penalty and interest. The said notice after receiving a reply culminated in the passing of an order in original in which the adjudicating authority confirmed the demand of duty of ₹ 4,04,171/- and also imposed a penalty of ₹ 50,00 .....

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n same premises. On going through the setting of Management of M/s Premium Suitings (P) Ltd., I find that there are three Directors. However in the case of the Appellants, the Management consists of only two Directors. Therefore, Management of the both the unit is different. Regarding housed in the same premises, I find that both the unit have separate passage/entrance and common wall between these units not be termed as one unit. Thus, it is also clear that both the units have different. They i .....

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factory being common Income Tax/Sales Tax Registration may be treated as one factory. Even definition of "factory" as defined in Section 2(e) of the said Act cannot stipulate any such conditions. I also notice that the end product is also different one manufacturer Chemicals/Adhesives and other manufacturers Cotton Fabric. The raw materials used by them are also different. Both the unit have their separate skilled staff. Both have separate Central Excise Registration. From the above d .....

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of one factory is not material for other - mere common boundary of two factories does not make them as one factory even though the Apex level factories are maintained by one company". In view of the Hon'ble Supreme Court and above discussed facts, I hold that both the factories are separate legal identity. In the light of the above stated facts and circumstances of the case, I pass the following order." The department, being aggrieved, filed a second appeal before the Tribunal, whi .....

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appellant M/s Premium Suiting (P) Ltd. (Chemical Division) are a unit independent from their Textile Division and are independently eligible for SSI exemption?" We have heard Sri Praveen Kumar, the learned counsel for the appellant and Sri Vinod Kant, the learned counsel for the department. The extract of the relevant notification that was applicable during the period in question, namely, Notification No.7 of 1997 dated 1st March, 1997 is extracted hereunder:- "The exemption contained .....

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nufacturer is entitled for exemption if the aggregate value of clearances of all excisable goods for home consumption from one or more factories or from a factory by one or more manufacturers does not exceed ₹ 3 crores in the preceding financial year. Admittedly, from the evidence that has come on record, the manufacturer has two factories. One factory is engaged in the manufacture of cloth and the second factory is engaged in the manufacture of Polymer Vinyl Acetate, etc. Both the goods m .....

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e has one or more factories, would be entitled for exemption at concessional rate of duty if the aggregate value of clearances of all excisable goods does not exceed ₹ 3 crores. Since the appellant has another factory, which is manufacturing an excisable commodity, its clearances have to be added while considering the exemption notification. Since the aggregate clearances exceeded the limit of ₹ 3 crores, the appellant was not entitled for exemption. The adjudicating authority rightl .....

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