Home Case Index All Cases Central Excise Central Excise + AT Central Excise - 2018 (6) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2018 (6) TMI 909 - AT - Central ExciseManufacture/Deemed Manufacture - Valuation - Affixation of MRP on packages - after import of items, the appellant affixes the MRP labels at port itself, adopted valuation under Section 4A and brought to warehouses or by stock transfer to their premises and then undertook activities of packing / repacking, affixing sticker / label such as “marketed by”, “HONDA” etc. without revising the MRP mentioned in the label affixed at the port. Whether repacking, inspection, labeling, affixation of MRP without price revision, affixation of “marketed by” label, affixing “HONDA” tape/sticker would be activities that could be brought within the ambit of manufacture as defined under section 2(f)(iii) of Central Excise Act, 1944? Held that:- Even a standalone activity of packing or / repacking of goods in a unit container would be deemed manufacture for the purposes of Section 2(f)(iii). So also, labeling or relabeling of containers would attract mischief; such labeling or relabeling could include the declaration or alteration of the retail sale price. There is yet another interesting “other than the above” category that would fall within the ambit of deemed manufacture, namely, “adoption of any other treatment on the goods” to render the product marketable to the consumer”. Rendering the product “marketable” is a catch-all phrase that in our view would include any treatment to make the product attractive to potential buyers and enhance its ‘marketability quotient. This could encompass many strategies e.g. replacing a dated packing / wrapper with a brand new one to ensure more eyeball display or affixation of a nationally or internationally known trademark or certifying mark. ( e.g. ‘3M’ product, ‘Intel’ Inside, ‘Apple’ compatible, ‘De Beers’ certified diamonds, Woolmark, Agmark, BIS hall mark etc.). As per section 2(f)(iii) ibid, one of the process which would result in “deemed manufacture” is labeling or relabeling of containers. There is no conditionality indicated therein that such labeling or relabeling should necessarily result in enhancement or alteration of price - affixation of the “Marketed By” label and especially the “HONDA” trademark label, enhances the marketability of these products. Trademarks are efficient commercial communication to capture customer attention. It speaks about the company, its reputation and products and services. An internationally known trademark like ‘HONDA’ will serve to allay any doubts on basic quality of the goods and make the goods more marketable. The processes carried out on the impugned goods received by the appellants from the port / other warehouses will amount to manufacture within the meaning of section 2(f)(iii) of the Act. Appeal allowed - decided in favor of appellant.
|