Full Judgment
Per Dr. Chittaranjan Satapathy
Heard both sides.
2. The authorities below have clubbed the value of clearances of M/s. Agni Textiles who were manufacturing polyester sewing threads in the same factory premises upto the first week of January 2002 with the value of clearances of the appellants who started manufacturing polyester sewing thread at the very same factory premises after M/s. Agni Textiles shifted to another new premises. The clubbing has been done in view of the provisions in the small scale exemption notification that clearances by one or more manufacturers from the same factory are required to be aggregated. The authorities below have relied on the ratio of the following decisions while deciding the matter against the appellants:-
(i) CCE, Baroda Vs. Comed Chemicals Pvt. Ltd. 2002 (141) ELT 369 (Tri. Mumbai)
(ii) Dukes Pharma Vs. Government of India 1994 (69) ELT 433 (Mad.)
(iii) Shyam Sunder U. Nichani Vs. Asstt. Collector of C. Ex. and Customs 1991 (56) ELT 5 (Kar.)
3. Shri M. Karthikeyan, learned counsel appearing for the appellants seeks to distinguish the aforecited decisions and states that they have no applicability to the present case of the appellants as they occupied the factory premises and started manufacturing only after the previous occupants namely M/s. Agni Textiles moved from the said factory premises to a new place where they took a new registration.
4. The learned DR Ms. Indira Sisupal appearing for the Department states that the expression factory is not defined in the small scale exemption notification but the same is defined in the Central Excise Act, 1944 to mean any premises wherein excisable goods are manufactured. She further states that in view of the clear cut provisions in the small scale exemption notification, the clearances of different manufacturers operating in the same factory even though during different periods of the same financial year are required to be clubbed. As such, she supports the impugned order which has been passed relying on the afore cited case laws.
5. We have considered arguments from both sides. We find that in Comed Chemicals (supra), the Tribunal concluded that the clearances of the goods from one factory during the financial year by both the manufacturers require to be clubbed and the clearances in excesses of the limits will not be entitled to exemption under the Notification. In the case of Dukes Pharma (supra), the Hon ble Madras High Court has also taken a view that value of clearances by different manufacturers from the same factory are required to be clubbed. Similar view has been taken by the Hon ble Karnataka High Court in the case of Shyam Sunder (supra). We find no reason to distinguish the ratio of these decisions specially in the present case, the learned counsel has not been able to show us any evidence to support his oral argument that the previous occupant of the factory moved out of the factory along with all the machinery and the appellants moved into a vacant factory premises with their own machinery. Even otherwise, the requirement under the impugned notification is that the value of clearances of the specified goods from one factory premises are required to be aggregated even if the clearances are made by or on behalf of more than one manufacturer. Hence, we are of the view that the impugned order requires no interference. Accordingly, the appeal is dismissed.