Contact us   Feedback   Subscription   New User   Login      
Tax Management India .com
TMI - Tax Management India. Com
Extracts
Home List
← Previous Next →

2015 (11) TMI 93 - SUPREME COURT

2015 (11) TMI 93 - SUPREME COURT - 2015 (325) E.L.T. 635 (SC) - Textile goods / Ready Made Garments (RMG) - article of apparel or clothing accessories - process of affixing a brand name or trade name / affixing lables after purchase of goods - Benefit of Exemption Notification No. 38/2003-CE dated 30th April, 2003 - Whether process undertaken by assessee fall within the processes that are mentioned in the Notification - Held that:- For the purpose of arriving at the value of the job at the hands .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ld satisfy the condition of "subsequent purchase" contained in Notification No. 38/2003. - this position is accepted even by the Department which can be discerned from Circular No. 737/53/2003-CX dated 19.08.2003. Though certain doubts for carrying out the obligation under Standards of Weights and Measures Act, 1976 were clarified by the said Circular, incidentally it touched upon this very process that is undertaken by the assessees herein and remarked that such process would be covered by Noti .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

or the Respondent : Mr. Anand Sukumar, Adv. Mr. S. Sukumaran, Adv. Mr. Bhupesh Kumar Pathak, Adv. Mr. Avinash Kankani, Adv. Ms. Meera Mathur,Adv. Mr. V. Lakshmikumaran, Adv. Mr. M. P. Devanath,Adv. Mr. T.D. Satish, Adv. Ms. L. Charanaya, Adv. Mr. Hemant Bajaj, Adv. Mr. Anandh K., Adv. Mr. Aditya Bhattacharya, Adv ORDER The Customs, Excise and Service Tax Appellate Tribunal (hereinafter referred to as the Tribunal') had, vide its decision dated 22.11.2006, decided the appeals of three assesse .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

.08.2006. They had challenged the order before the Tribunal and had succeeded in the appeals filed by them. It is because of this reason, the Department has filed the instant appeals challenging the said common judgment of the Tribunal. In the first instance, we would like to reproduce the relevant portion of the Notification No. 38/2003 which is as under: "Notification : 38/2003-C.E. dated 30-Apr-2003 Textile articles - Exemption - Amendment to Notification No. 7/2003- C.E. In exercise of .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ral Excise, dated 1st March, 2003, namely - In the said notification, in Table, after S. No. 45 and entries relating thereto, the following S. Nos. and entries shall be inserted, namely - XXX XXX 50 61 or 62 Article of apparel or clothing accessories when subject to any one or more of the following processses, other than the process of affixing a brand name or trade name, subsequent to purchase, namely :- (1) labeling or re-labeling, that is to say, attaching or affixing price tag, name of selle .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

pose of indicating, or so as to indicate a connection in the course of trade between such specified goods and some person using such name or mark with or without any indication of the identity of that person." NIL - A bare reading of the aforesaid Notification makes it clear that the benefit thereof is given to those assessees when, at their hands, article of apparel or clothing accessories is subjected to any one or more of the processes, which are mentioned herein. However, any of such pr .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

aken note of by the Tribunal and about which there is no dispute and the said process is stated by the Tribunal in the following manner: "M/s Aditya Birla Nuvo Ltd. The appellants would place orders on various inputs and the suppliers would send the inputs directly to the job workers, who would avail Cenvat Credit and manufacture Ready Made Garments (RMG). The RMG would be affixed with the brand name of the appellant. The job worker would clear the RMG in bulk condition. Duty would be paid .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ll piece of the fabric, commercially known as swatch. Each RMG is thereafter arranged and stored for further transportation for which purpose they are put in a corrugated box. M/s Levis Strauss (India) Pvt. Ltd. Vs. CCE, Bangalore-I, Commissionerate The appellant is a dealer/trader in RMG, which have the name Levis and Dockers on them. These goods were got manufactured by the appellant from independent contract manufactures on payment of job charges, after supply of inputs such as fabrics/access .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

rs receive the input, take Cenvat credit and manufacture garments. They clear the garments in bulk on payment of excise duty valuing the goods under Section 4 on the value of raw material + job charges. These garments are sent back to the warehouse of the appellant. On receipt of the duty paid garments in bulk into their warehouse, the appellant carries out price tagging, stickering, washing instructions, tagging and retail packing." The aforesaid processes undertaken by all these three ass .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

l back to the assessees, this does not amount to purchase. We may mention at this stage that though the Tribunal has undertaken a detailed discussion on this aspect holding that this would amount to "purchase" within the meaning of Section 2H of the Central Excise Act, 1944, it is not even necessary to go into the same as we find that the case is squarely covered by a Constitution Bench Judgment of this Court in Ujagar Prints, etc. etc. vs. Union of India & Ors. [1989(39) ELT 493(S .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

r that the assessable value of the processed fabric would be the value of the grey-cloth in the hands of the processor plus the value of the job work done plus manufacturing profit and manufacturing expenses deemed to be the price at the factory gate for the processed fabric. The factory gate here means the 'deemed' factory gate as if the processed fabric was sold by the processor. In order to explain the position it is made clear by the following illustration: if the value of the grey-c .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

give a declaration to the processor as to what would be the price at which he would be selling the processed goods in the market, that would be taken by the Excise authorities as the assessable-value of the processed fabric and excise duty would be charged to the processor on that basis provided that the declaration as to the price at which he would be selling the processed goods in the market, would include only the price or deemed price at which the processed fabric would leave the processor&# .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

the manufacturing profit and the manufacturing expenses but not any other subsequent profit or expenses. It is necessary to include the processor's expenses, costs and charges plus profit, but it is not necessary to include the trader's profits who gets the fabrics processed, because those would be post-manufacturing profits." The aforesaid clarification makes it clear that for the purpose of arriving at the value of the job at the hands of job workers, factory gate is treated as & .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ubsequent purchase" contained in Notification No. 38/2003. In fact, this position is accepted even by the Department which can be discerned from Circular No. 737/53/2003-CX dated 19.08.2003. Though certain doubts for carrying out the obligation under Standards of Weights and Measures Act, 1976 were clarified by the said Circular, incidentally it touched upon this very process that is undertaken by the assessees herein and remarked that such process would be covered by Notification No. 38/20 .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 



|| Home || Acts and Rules || Notifications || Circulars || Schedules || Tariff || Forms || Case Laws || Manuals ||

|| About us || Contact us || Disclaimer || Terms of Use || Privacy Policy || TMI Database || Members || Site Map ||

© Taxmanagementindia.com [A unit of MS Knowledge Processing Pvt. Ltd.] All rights reserved.

Go to Mobile Version