2008 (9) TMI 714 - AT - Central Excise

Summary

Issues Involved
1. Denial of small-scale exemption Notification No. 1/93.
2. Affixing of brand name on goods.
3. Limitation period for raising demands.
4. Divergence in opinions among the judges regarding specific appeals.

Detailed Analysis

1. Denial of Small-Scale Exemption Notification No. 1/93
The appellants, engaged in the texturizing of yarn, were denied the benefit of small-scale exemption Notification No. 1/93 on the grounds that they used the brand name of other persons who sent them POY for texturizing. The adjudicating authority observed that the appellants reused cartons bearing the brand name of the POY manufacturers, which amounted to affixing a brand name on the goods, thus disentitling them from the exemption.

2. Affixing of Brand Name on Goods
The appellants contended that packing the textured yarn in the same cartons received from POY manufacturers bearing packing slips did not amount to affixing a brand name on the goods. They relied on various Tribunal decisions, including CCE, Indore v. S.P. Tools Pvt. Ltd., CCE, Mangalore v. Malabar Oxygen Pvt. Ltd., and M/s. Brisk Surgical Cotton, which held that monograms or labels indicating the manufacturer's name do not constitute affixing a brand name. The Tribunal agreed with the appellants, stating that the use of packing slips for identification purposes did not amount to the use of a brand name in the course of trade. The decision in M/s. Neelam Fibres was also cited, which supported the appellants' stance that such use did not disqualify them from the exemption.

3. Limitation Period for Raising Demands
The appellants argued that the demand was time-barred. The Tribunal referred to the case of M/s. Ramply (India) Ltd. & Anr., which held that the omission to declare the use of another's brand in the classification list cannot lead to the application of an extended time limit. Similarly, in CCE, Rajkot v. Fluid Synthetic Incorporation & ors., it was held that demands raised beyond the normal period of limitation are hit by the bar of time limitation. The Tribunal found the demands raised beyond the normal period to be time-barred.

4. Divergence in Opinions Among Judges
There was a divergence of opinion between the judges regarding the appeals of M/s. Jagat Texturising & one other. While Member (Judicial) allowed the appeals on both merits and limitation, Member (Technical) disagreed on the merits but did not comment on the limitation aspect. The matter was referred to a third member, who agreed with the Member (Judicial) on the limitation aspect, thereby allowing the appeals with consequential relief.

Conclusion
The Tribunal set aside the impugned orders and allowed all the appeals with consequential relief to the appellants. The use of packing slips for identification purposes was not considered as affixing a brand name, and the demands raised beyond the normal period were found to be time-barred. The final order, pronounced in court, upheld the appellants' entitlement to the small-scale exemption Notification No. 1/93.