Customs, Excise and Gold Tribunal - Tamil Nadu
Sharda Silicate And Chemicals ... vs C.C.E. on 1 March, 1995
Equivalent citations: 1995(78)ELT83(TRI-CHENNAI)
ORDER S. Kalyanam, Vice President 1. This appeal is directed against the order of the Collector of Central Excise (Appeals), Trichy, dated 29-1-1992 who confirmed the order of the original authority i.e. Assistant Collector of Central Excise, Coimbatore, dated 18-3-1991. 2. Shri Hassan Khan, the learned Consultant for the appellant submitted that the short issue arising for consideration in the appeal is that the appellants having two units manufacturing sodium silicate, one at Coimbatore and the other at Bhoothangudi, Tanjore District has been asked to club the clearances of both the units for the period from 18-10-1990 to 8-12-1990 in terms of Notification 175/86, dated 1-3-1986. It was submitted that the aggregate clearances of the goods belonging to the same manufacturer is reckoned in terms of Notification 175/86. Shri Hassan Khan further submitted that while he has no quarrel for the same, he would only plead that each unit which is separately licenced under the Central Excises & Salt Act, 1944 should be allowed to discharge the duty liability by making the debit entries in the RG 23 Part II in respect of the Modvat Credit by each unit in respect of the clearances from each unit. He pleaded that what the department wants is that even though the two units are separate entities, for the clearances of the goods from each unit, duty liability can be discharged by one unit. The learned Consultant assailed the correctness of this reasoning. 3. Shri Venkatan, the learned DR submitted that for the purpose of Notification 175/86 the clearances from two units of the same manufacturer should be clubbed and the authorities can direct discharge of duty liability by one of the two units for the entire duty payable by both the units. 4. We have gone through the records. The appellant has two units, i.e. one at Coimbatore and the other at Bhoothangudi, Tanjore District. Both the units are independent and are manufacturing excisable goods under licences issued by the department and clearances of both the units therefore should be clubbed in terms of Notification 175/86 for the purpose of discharge of duty liability. Be that as it may, that does not mean that each separate unit should not discharge its separate duty liability as per law merely because both the units are owned by one and the same manufacturer. We agree with the plea of the learned Consultant for the appellant that though each unit is separately licenced and notwithstanding the units have a common owner, each unit can discharge its duty liability if the Modvat Credit is available in RG 23 Part I respectively. In this view of the matter, the impugned order is set aside and the appeal allowed. ORDER V.P. Gulati, Member (T)
5. I observe that the basic mistake committed by the authorities while raising the demand of the duty is that the demand has been raised against one unit. The two units admittedly are separately licensed and clearances of each unit are to be reckoned separately excepting for the purpose of clubbing the aggregate clearances of the two units. After having taken the aggregate clearances of both the units together for the purpose of assessment of duty liability in terms of Notification 175/86, duty liability for each unit should have been quantified separately taking into account the clearances made from each unit and the eligibility to take Modvat Credit earned by the respective unit and recovery made either from the PLA and/or from the credit available from RG 23 Part I from respective units. It is seen from the order of the lower appellate authority that demand has been raised against one unit in respect of the duty payable by both the units separately in respect of the clearances made by each unit. The plea of the appellant therefore, for payment [of] duty by the respective unit has to be allowed.