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M/s. Rexford (I) Pharmaceuticals And Mr. Kirit S. Sanghvi Versus Commissioner of Central Excise, Thane II

2015 (10) TMI 964 - CESTAT MUMBAI

Denial of SSi Exemption - Benefit of Notification 175/86 - Use of other's brand name - Held that:- Even though M/s. VPL has taken the provisional SSI certificate but manufacturing facility had not come into existence; It was only that the land was purchased and they were in the process of establishing the manufacturing unit. During investigation from the statement of the officials of M/s. VPL it is clear that the appellant was aware of the fact that M/s. VPL has no manufacturing facility. It is .....

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ave not been produced by M/s. VPL but by the appellant. In our considered view, the said clarifications of Circular: B-21/15/ 86-TRU, dated 3-4-1987 and Circular No. 46/90-CX.8, dated 11-7-1990 are not relevant. In the present circumstances, what is to be seen is M/s. VPL is a functional SSI unit and eligible for the benefit of Notification 175/86. - Decided against assessee. - Appeal No. E/2990 & 2991/05 - Mum - Dated:- 15-9-2015 - Shri P.K. Jain, Member (Technical) And Shri S. S. Garg, Member .....

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ort). The medicines manufactured were having the brand name of M/s. VPL. It was further claimed that the said M/s. VPL is a small scale unit and since the appellant were manufacturing the goods of another small scale unit carrying the brand name of that SSI, they are eligible for the benefit of Notification 175/86 even in respect of goods manufactured on behalf of M/s. VPL. 2. On the basis of information, the matter was investigated and it was found that M/s. VPL is a subsidiary company of a big .....

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riod in question no manufacturing activity was carried out by M/s. VPL as the unit did not have manufacturing facility. Keeping in view the fact that M/s. VPL did not have the manufacturing facility during the relevant period and therefore, cannot be considered as a Small Scale unit, Revenue is of the view that the benefit of Notification 175/86 cannot be extended to the appellant in respect of the goods manufactured by them on behalf of M/s. VPL. After investigation which included recording of .....

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ppellant has undertaken the manufacturing on behalf of M/s. VPL after filing the classification list in which it was very clearly shown that they are going to manufacture goods on behalf of M/s. VPL. It was further submitted that at the relevant time M/s. VPL had provisional SSI registration certificate and as clarified by the Board vide circular no. B-21/15/86-TRU dated 03.04.1987 the provisional registration from the state government authorities could be accepted for purpose of duty concession .....

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Giridhara Supply Co. 1997 (94) ELT 14 (SC) * Project Technologists P. Ltd. 2003 (161) ELT 783 (T) * Laxmi Vishnu Dye Chem 2002 (142) ELT 611 (T) 3.1. Ld. counsels contention was that since the classification list was approved and M/s. VPL had the provisional SSI registration certificate which was later on converted into permanent SSI certificate, Revenue cannot demand the duty at this stage and therefore there is no question of any penalty. It was further submitted that the demand notice has in .....

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e same has been discussed in detail by the Hon'ble Supreme Court in the case of ITW Signode India Ltd. 2003 (158) ELT 403 (SC). Ld. AR submitted in view of the said decision of the Hon'ble Supreme Court approval of the classification list cannot stop the department from issuing the demand for the past period. Further, extended period of limitation can be invoked if the ingredients of proviso are satisfied. 4.1. Ld. AR further submitted that the issue of brand name is elaborately discusse .....

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* CCE vs. Rukmani Pakkwell Traders 2004 (165) ELT 481 * CCE vs. Ace Auto Comp. Ltd. 2011 (263) ELT 3 (SC) * Parle Bisleri P. Ltd. 2011 (263) ELT 15 (SC). 4.2. Ld. AR further submitted that there is no dispute that the medicine manufactured had the brand name of M/s. VPL and therefore the goods manufactured were branded goods. Thus appellant manufactured goods carrying brand name of M/s. VPL. It was further submitted that since M/s. VPL at the relevant time was not at all the manufacturing unit .....

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rom various authorities. It is only after the unit starts commercial production that permanent SSI certificate is granted. Ld. AR further submitted that appellant is not claiming that M/s. VPL was a functional unit during the period under dispute. Ld. AR also submitted that the clarifications referred are relevant for the goods manufactured in SSI unit themselves and not to the goods which have been manufactured on their behalf in some other unit. In view of the said factual position, the appell .....

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ssification list. 5. We have considered the submissions made by both sides. The relevant provisions in Notification 175/86 is as under : 7. The exemption contained in the Notification shall not apply to the specified goods where a manufacturer affixes the specified goods with a brand name or trade name (registered or not) of another person who is not eligible for the grant of exemption under this notification: Provided that nothing contained in this paragraph shall be applicable to the specified .....

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I unit carrying the brand name of such other SSI unit. However, if a SSI unit was manufacturing the branded goods on behalf of any person other than SSI unit then benefit of Notification 175/86 in respect of such goods was not available. In the present case, there is no dispute that the appellants were manufacturing the branded goods on behalf of M/s. VPL. However, the appellant has claimed the benefit on the grounds M/s. VPL is a SSI unit. We find from the facts that at the relevant time, even .....

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not commenced the commercial production. Hence goods manufactured by the appellant in the brand name of M/s. VPL would not be eligible for the benefit of Notification 175/86. Ld. counsel has emphasised that the unit was provisionally registered and in view of Boards clarification dated 03.04.1987 and further clarification dated 11.07.1990, M/s. VPL will be eligible to the benefit of SSI. We have gone through the clarification. Relevant portion of clarification dated 03.04.1987 and 11.07.1990. .....

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under the aforesaid notification. Circular No. 46/90-CX.8, dated 11-7-1990 Doubts were raised whether : - (a) An assessee who was holding a provisional certificate but is denied permanent registration would still be entitled to exemption in terms of para 4(b) of Notification No. 175/86 and (b) With regard to point No.(a), the Conference felt that a provisional registration with SSI Directorate was no registration. For purposes of Notification No. 175/86, dated 1-3-1986 as amended, an SSI unit wa .....

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respect of the goods produced by the SSI unit themselves by availing the benefit of Notification 175/86. The purpose of this clarification is that many a time a unit might have a provisional SSI certificate and thereafter would have started the commercial production while the state government authorities grant permanent SSI certificate after ensuring that such unit have started the commercial production and have the necessary capabilities and facilities. During the intervening period, if a view .....

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