2001 (5) TMI 849 - AT - Central Excise

Summary

Issues:
1. Denial of SSI exemption on products due to brand name usage.
2. Classification of goods as animal feed supplements.
3. Imposition of penalties under Rule 173Q(1) and Rule 173Q(2).

Analysis:
1. The judgment involved two appeals and a cross objection regarding the denial of SSI exemption on certain products due to the usage of the brand name 'VETCARE' and the imposition of penalties under Rule 173Q(1). The Collector had held that the products Halquinol and Sanitech were not eligible for the SSI Notification benefit due to the use of the brand name belonging to another company not entitled to SSI exemption. However, the Tribunal found discrepancies in the evidence presented, especially regarding the non-disclosure of labels crucial for determining the nature of the goods. The Tribunal concluded that the non-disclosure of labels by the appellant led to an incorrect finding by the Collector and ordered a remand for re-determination.

2. The second issue pertained to the classification of goods as animal feed supplements under heading 2302.00 of the Central Excise Tariff Act, 1985. The Collector had proposed to classify certain products elsewhere, but the Tribunal disagreed and found that the goods 3-CARE and COLIDOX were rightly classifiable as animal feed supplements. The Tribunal highlighted that since these goods were classified under 2302 and eligible for exemption, there was no need to determine whether they were branded or not. The Tribunal set aside the order and allowed the appeals for a remand for de novo adjudication.

3. Regarding the imposition of penalties under Rule 173Q(1) and Rule 173Q(2), the Tribunal found that while a penalty of Rs. 500 was imposed for contravening duty payment rules on specific branded goods, there was no case for the imposition of penalty and confiscation under Rule 173Q(2). The Tribunal's decision to remand the case for re-determination encompassed all aspects, including the penalties imposed, leaving the classification and other points open for further adjudication before the Adjudicating Authority. Ultimately, the Tribunal set aside the order and allowed the appeals by remanding the case for de novo adjudication, emphasizing the need for a thorough re-examination of the issues involved.