KISAN SAHKARI CHINI MILLS LTD. Vs. CCE

JUDGEMENT

(1.) The appellants are manufacturers of VP sugar, molasses and Special Denatured Spirit [SDS]. They had separate registration certificates under Rule 174 of the Central Excise Rules, 1944 from the Department for the manufacture of these products. The Registration Certificates in respect of sugar and molasses were obtained in 1992 and that in respect of SDS obtained later on (in 1994). In December 2000, they applied for a single registration for all the three products under the amended provisions of Rule 174. The jurisdictional Superintendent of Central Excise allowed the application and intimated the same to the party by letter dated 2.1.2001. But, by show -cause notice dated 5.12.2001, the Deputy Commissioner of Central Excise, Division Varanasi, directed the party to show cause why the single registration granted to them by the Superintendent of Central Excise should not be revoked and why three separate registration certificates should not be issued to them as in the past. The appellants contested the show cause notice by way of a detailed reply, wherein they relied inter alia on a decision of this Tribunal as well as the Chandigarh Collectorate Trade Notice No. 98/CE/94 dated 29.9.94 in support of their contention that under the amended provisions of Rule 174, they were entitled to single registration with the Department in respect of their Sugar Unit (which manufactured sugar and molasses) and Distillery Unit (which manufactured SDS) which were situated/in the same premises. The adjudicating authority, without giving the party any opportunity of being personally heard, passed on order revoking the single registration and restoring the separate registration certificates of 1992/1994. The appeal preferred by the party to the Commissioner (Appeals) against the decision of the Deputy Commissioner did not succeed. Hence the present appeal.

(2.) We have heard both the sides. The learned Counsel submitted that Superintendent's order dated 2.1.2001 was an appealable order and the proper remedy for the Department was to file an appeal against it instead of issuing the show -cause notice; that VP sugar and molasses were products of the same process of manufacture involving the same machinery and, therefore, there was no valid reason for separate registration in respect of the two products; that the sugar and SDS units were situated in the same premises; that the two units were separated only by a wall which was erected for the purpose of safety; that the separation of the two units by the said wall did not deprive the appellants of the benefit of single registration as clarified by the CBEC in its relevant circular; that the two units had a common PAN (Permanent Account Number) under the Income -tax Act and were owned by the same legal entity namely M/s. Kisan Sahkari Chini Mills Ltd; and that the issue involved was squarely covered in their favour by various decisions of this Tribunal. The learned Counsel cited the following decisions: Balrampur Chini Mills Ltd v. CCE, Allahabad, 2002 (149) ELT 286 K.M. Sugar Mills Ltd v. CCE Allahabad, 2001 (47) RLT 194 Dhampur Sugar Mills Ltd v. CCE, Meerut, 2001 (129) ELT 73 Shravasti Kisan Sahkari Chini Mills Ltd v. CCE Allahabad, 2002 (142) ELT 118

(3.) The DR reiterated the findings of the authorities below. Referring to the CBEC's instructions, he argued that an artificial partition like a wall installed between the Sugar and SDS units by the party on their own was not comparable to other means of separation like canal, public road, railway line etc. and, therefore, the Board's instructions were of no aid to the appellants. Learned DR also sought to distinguish the instant case from the cases cited by the Counsel.