2014 (10) TMI 725 - HC - Central Excise

SSI Exemption - Brand Name - assigning the brand name - Manufacturing of Nipple or complete feeding bottles - affixing/assembling of Nipple to other components/accessories bought out from outside or manufactured by others - Valuation - Brand Name - Held that - In view of the judgment of the Supreme Court in Naveen Chemicals (1993 (9) TMI 107 - SUPREME COURT OF INDIA), we are of the view that the issue raised in the appeal has a direct and proximate relationship to the rate of duty within the meaning of Section 35-G and the issue as to whether the assessee was or was not entitled to the benefit of the exemption, cannot be decided in these proceedings. Hence, the appeal would not be maintainable on that ground. - Decided against Revenue.

Summary

Issues:
- Maintainability of appeal under Section 35G of the Central Excise Act, 1944.

Analysis:
The appeal in question arose from an order of the CESTAT, where the Revenue challenged the justification provided by CESTAT regarding the assignment of a trade mark and the subsequent entitlement to the benefit of SSI exemption by a company. The primary issue was whether the appeal was maintainable under Section 35G of the Central Excise Act, 1944. The Tribunal had concluded that the benefit of the SSI exemption was undeniable, leading to a dispute on the interpretation of the relevant legal provisions.

The crux of the matter revolved around the interpretation of Section 35G, which allows an appeal to the High Court from an order passed by the Appellate Tribunal, excluding orders related to certain specified matters, including those having a relation to the rate of excise duty. Referring to precedent cases, the judgment highlighted the requirement of a direct and proximate relationship to the rate of duty and the value of goods for the purposes of assessment. The Supreme Court's ruling in Naveen Chemicals case emphasized that disputes concerning classification of goods and exemption notifications directly impact the applicable rate of duty for assessment purposes.

Drawing from legal precedents, the High Court determined that the issue at hand, concerning the entitlement to the SSI exemption, indeed had a direct and proximate relationship to the rate of duty, falling within the ambit of Section 35G. As a result, the Court concluded that the appeal was not maintainable on the grounds of the issue's direct relevance to the rate of excise duty, as stipulated by the law.

Consequently, the High Court dismissed the appeal solely on the basis of its non-maintainability due to the direct relationship of the issue with the rate of duty. The judgment also allowed the Revenue to obtain a certified copy of the Tribunal's judgment for potential further legal proceedings before the Supreme Court, facilitating the proper documentation required for any future appeals.