TMI Blog2017 (5) TMI 31X X X X Extracts X X X X X X X X Extracts X X X X ..... ing the brand name or trade name of another person, are excluded from the turnover, the same will be within the exemption limit. The assessee is entitled to SSI exemption - appeal allowed - decided in favor of appellant. - E/3675/2010-Ex(DB), E/3632-3633/2010-Ex(DB) - A/52582-52584/2017-EX[DB] - Dated:- 23-2-2017 - Mr. Ashok Jindal, Member (Judicial) and Mr. V. Padmanabhan, Member (Technical) Shri. B.L. Narsimhan, Advocate for the appellant Shr. H.C. Saini, AR for the respondent Per: Ashok Jindal Both sides are in appeal. 2. The facts of the case are that the assessee is engaged in the manufacture of various exempted goods namely, advertisement and publicity material i.e. calendars, posters, pictures, diaries, telephone index, folder, poster, dangler, banners etc. Substantial portion of the exempted goods manufactured by the appellants in their factory are goods bearing name of their buyer where the brand name does not belong to the appellants. The assessee was availing the SSI exemption whereas the Revenue is of the view that the assessee is not entitled to exemption in respect of the dutiable goods manufactured by way of amendment in the notificati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or chargeable to nil rate of duty and dutiable goods. Therefore, the Id. Commissioner (Appeals) has wrongly concluded otherwise in the impugned order. Had this been the intention of the Government, the Notification would have clearly provided for such a distinction. In absence of any express wordings, such a distinction cannot be created or inferred. 5. It is his submission that the assessee have fulfilled both aspects of clause (b) of para 3A in as much as their goods bear the brand name of their buyers and their goods attract the provisions of para 4. To support his contention, he relied on the following decisions: (i) Savotham Care Limited vs. CCE, Hyderabad-IV-2015 (324) ELT 565 (Tri.-Bang.) (ii) Roots Multiclean Ltd. vs. CCE, Coimbatore-2011 (266) ELT 108 (Tri.-Chen). 5. On the other hand, learned AR opposed the contention of the learned Counsel and supported the impugned order disallowing the benefit of SSI exemption and submitted that the assessee is not entitled to avail credit on the inputs used in the manufacture of exempted goods. 6. Heard and considered the submissions. 7. We find that the similar issue came up before this Tribunal in the case of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 50/2003. The question is whether the branded goods exempted under Notification Nos.49 and 50/2003 can be said to be covered by Paragraph 4 thereby taking them out of purview of the SSI exemption notification. In the impugned order, Commissioner has taken a view that if the branded goods enjoy the SSI benefit by satisfying conditions in Para 4, their value should be taken into consideration. There cannot be any dispute about this observation. However, he has taken a view that viewed in the context that if the items are covered by Paragraph 4, their value has to be taken into account for the purpose of arriving at aggregate value of clearances of ₹ 1.5 crores or ₹ 4 crores, the value of such goods has to be taken into account. According to learned Commissioner, the intention is to charge duty on branded goods exception being Paragraph 4. It is his view that since the appellants did not pay duty on the branded goods manufactured in Himachal Pradesh and when branded goods do not suffer duty, their value has to be included if they are exempt because of being covered under Paragraph 4, the intention of the legislature or notification has to be taken as meaning that branded ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e computing the limits under the small scale exemption scheme. It is not in dispute that the brand name used by the appellants contains both 'ROOTS' and HAKO' which are respectively the brand names of their foreign collaborators M/s. American Auto Service, USA and M/s. Hako Werke GmbH, Germany. We find that the Hon'ble Supreme Court in the case of Commissioner of Central Excise, Trichy v. Rukmani Pakkwell Traders - 2004 (165) E.L.T. 481 (S.C.) has held that even use of part of a brand name or trade name so long as it indicates a connection in the course of trade would be sufficient to disentitle a person from availing small scale exemption. Applying the ratio of the aforecited decision of the Hon'ble Supreme Court to the case at hand, we find that the appellants are using brand name of not one but two of their foreign collaborators and as such, they are not entitled to small scale exemption in respect of such goods manufactured in their Pollachi unit. We also find that the appellants have not claimed small scale exemption for such goods and they have paid the duty applicable on such goods which has been accepted by the Department. The same also is quite in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... de name, whether registered or not, of another person, except in the following cases: (a) where the specified goods, being in the nature of components or parts of any machinery or equipment or appliances, are cleared for use as original equipment in the manufacture of the said machinery or equipment or appliances by following the procedure laid down in the Central Excise (Removal of Goods at Concessional rate of Duty for Manufacture of Excisable Goods) Rules, 2001. 10. It is clear that to determine aggregate value of clearances of excisable goods for home consumption and clearances bearing the brand name or trade name of another person, which are ineligible for the grant of this notification in terms of para 4 are not to be included. Admittedly, if the clearances bearing the brand name or trade name of another person, are excluded from the turnover, the same will be within the exemption limit. Therefore, relying on the precedent decisions, we hold that the assessee is entitled to SSI exemption. Consequently, the appeal filed by the assessee is allowed and the appeal filed by the Revenue is dismissed. (pronounced in the open court) - - TaxTMI - TMITax - Central Exci ..... X X X X Extracts X X X X X X X X Extracts X X X X
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