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1997 (5) TMI 390 - AT - Central Excise
Issues:
Interpretation of small-scale exemption Notification No. 175/86-C.E. for goods manufactured by Loan Licensees in a factory. Analysis: The judgment by the Appellate Tribunal CEGAT, Kolkata involved the interpretation of the small-scale exemption Notification No. 175/86-C.E. regarding goods manufactured by Loan Licensees in a factory. The appellant-company was a manufacturer of patent or proprietary medicines, and four other companies were utilizing their factory for manufacturing goods. The Department denied the small-scale exemption to the goods manufactured by these four companies, stating that the brand names on the goods did not belong to the appellant company. The Tribunal had previously addressed a similar issue in the case of N.P. Industries v. Commissioner of Central Excise, Calcutta-I, relying on the judgment of the Gujarat High Court in the case of Indica Laboratories Pvt. Ltd. v. Union of India. The Revenue Commissioner argued that the four companies were acting as another person under Para 7 of the Notification and thus not eligible for the exemption. Reference was made to the judgment in the case of Harts Cocoa Products Pvt. Ltd. v. Commissioner of Central Excise, Madras. However, the Tribunal found that the facts of the present case were akin to the N.P. Industries case, where the four companies were considered manufacturers in their own right as they had separate Drug Licenses and controlled the manufacturing process in the appellant's factory. The Tribunal noted that the four companies had met the conditions of the S.S.I. Unit as per the Notification. The judgment in Harts Cocoa Products was deemed inapplicable as the situation involved Loan Licensees, unlike the case in question. The Tribunal concluded that the present case aligned with its previous judgment in N.P. Industries, which was based on the Gujarat High Court's ruling in Indica Laboratories. Consequently, the appeal was allowed in favor of the appellants, granting them consequential reliefs.
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