TMI Blog2012 (10) TMI 191X X X X Extracts X X X X X X X X Extracts X X X X ..... on other than the manufacturer, the SSI exemption would not be available, irrespective of whether the customer sells the goods as such or uses the same as inputs in the manufacture of other goods or uses the same as capital goods or part of capital goods. The value of the goods cleared under brand name of MUL on payment of duty can not be included for the purpose of computation of turnover under SSI exemption benefit. - E/2543/2011 - A/517/2012-EX(BR)(PB) - Dated:- 4-5-2012 - Justice Ajit Bharihoke, Shri Rakesh Kumar, JJ. REPRESENTED BY : Shri R. Krishnan, Advocate, for the Appellant. Shri S.K. Panda, Jt. CDR, for the Respondent. [Order per : Rakesh Kumar, Member (T)]. The appellant manufacture car alarm system, power window circuit, car security system, car cassette players and speakers, CCTV camera, transmitter-receivers, etc. under their own brand name as well as under the brand name Maruti of Maruti Udyog Ltd. (MUL). They avail SSI exemption under Notification No. 9/2003-C.E., dated 1-3-2003 under which in respect of first clearances of value upto rupees one crore in a financial year, there was concessional rate of duty - 60% of the normal rate i.e. 9. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ant under Section 11AC. 1.2 On appeal to CCE (Appeals), the Deputy Commissioner s order was upheld vide order-in-appeal No. 170-CE/APPL/Noida/2011 dated 29-7-2011. 1.3 Against the above order, this appeal has been filed. 2. Heard both the sides. 2.1 Shri R. Krishnan, Advocate, the learned Counsel for the appellant, pleaded that - duty on Maruti branded goods was correctly paid at the normal rate i.e. 16% adv., and the value of Maruti branded goods was correctly excluded from the value of clearances eligible for concessional rate of duty, that para 4 of the Notification No. 9/2003-C.E. clearly states that the exemption under this notification shall not apply to the goods bearing brand name or trade name, whether registered or not, of another person, that though in terms of exception in clause (a) of para 4, the specified goods affixed with the brand name of another person are eligible for exemption when the same 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 a procedure prescribed in this regard, the appellant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the appellant manufacture among other goods, - transmitter - receivers for MUL and clear the same to MUL after affixing the same with brand name Maruti of MUL and these goods are used with production machinery by the MUL. 4.1 During the period of dispute, the relevant part of para 4 of the Notification No. 9/2003-C.E. was as under - 4. The exemption contained in this notification shall not apply to the specified goods bearing a brand name or trade name, whether registered or not, of another person, except in the following cases, namely :- (a) where 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 : 4.2 The words - brand name or trade name are defined in Explanation A to the notification as - (A) brand name or trade name means a brand name or trade name, whether registered or not, that is to say a name or a mark, such as symbol, monogram, label, sig ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er is not relevant for this notification, has held that the elastics affixed with the brand name of the customer would not be eligible for SSI exemption, even if the same are used by the customer as input in the manufacture of under garments. Para 7 and 8 of the judgment are reproduced below :- 7. It is on just such a reasoning that the Full Bench of the Tribunal has held that the exemption is not lost. We are afraid that there is complete misreading and a misunderstanding of the Notification. As set out hereinabove, Clause 4 of the Notification is clear and unambiguous. It says that the exemption is lost if the goods bear the brand/trade name of another. There are no other qualifying words. The term goods admittedly refers to goods which are otherwise excisable except for the exemption granted by the Notification. In this case admittedly goods are the elastic manufactured by the Appellants. As stated above Clause 4 does not provide that exemption is lost only for goods (elastic) which are sold in the market or on those goods (elastic) which reach customers without any change in form. Clause 4 does not provide that the exemption will not be lost if the goods (elasti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... affixed will not and cannot be used by any person other than the person using that brand/trade name. As set out hereinabove once a brand/trade name is used in the course of trade of the manufacturer, who is indicating a connection between the goods manufactured by him and the person using the brand/trade name, the exemption is lost. In any case it cannot be forgotten that the customer wants his brand/trade name affixed on the product not for his own knowledge or interest. The elastic supplied by the Appellants is becoming part and parcel of the undergarment. The customer is getting the brand/trade name affixed because he wants the ultimate customer to know that there is a connection between the product and him. Of course the intention of the customer is not relevant for the purposes of this Notification. This is being mentioned only to indicate that interpretation sought to be placed by Mr. Sridharan would enable manufacturers, who are otherwise not eligible, to get manufactured from small scale industries like the Appellants their goods or some inputs, affix their brand/trade name and still avail of exemption. When the wording of the Notification are clear and unambiguous, th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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