2009 (3) TMI 867 - AT - Central Excise

Summary

Issues involved: Determination of liability to pay Central Excise Duty on branded jewellery manufactured on job work basis.

Summary:
The issue in the appeals/stay petitions revolved around the liability of the applicants, engaged in getting jewellery manufactured on job work basis, to pay Central Excise Duty on branded jewellery. The Revenue contended that the jewellery, marked with identifiers like "CKC" and "ABJ," constituted branded jewellery attracting duty liability. The Commissioner held the applicants responsible for Central Excise Duty and Education Cess on the branded jewellery.

The applicants argued that as they supplied gold to job workers who actually manufactured the jewellery, they should not be liable for Central Excise Duty. They emphasized that the markings were solely for identification purposes and did not constitute brand names. They cited a Ministry of Finance clarification stating that the duty liability typically falls on the entity affixing the brand name. Referring to legal precedents, they asserted that the actual manufacturer, not the raw material supplier, should bear the duty liability.

Regarding the brand name contention, the applicants relied on legal decisions supporting their stance. The Departmental Representative highlighted the Adjudicating Authority's findings on the applicants' liability under Rule 12AA and the branding of the ornaments. The Tribunal concurred that the raw material supplier should not be considered the manufacturer and that mere embossing of identifiers did not amount to affixing a brand name. Consequently, the Tribunal waived the pre-deposit amounts specified in the impugned orders and stayed the recovery pending appeal disposal, instructing Revenue not to take coercive measures during this period. The Stay Order was to remain effective even after 180 days, with the appeals scheduled for subsequent consideration.