2018 (9) TMI 1901 - AT - Central Excise

SSI Exemption - use of brand name of others - Department was of the view that the appellant will not be entitled to the benefit of SSI Exemption in respect of the printed diaries since they were cleared bearing the brand name of LIC - N/N. 08/2018-CE dated 01/03/2003 - period from 2006 to 2007 - CBEC vide Circular No. 71/71/94-CX dt. 27/10/1994 - HELD THAT - The business of LIC is Life Insurance. They are neither manufacturers nor traders of diaries. Consequently in the light of the clarification above the mischief of provisions relating to brand will not be attracted in the present case. The appellant will be entitled to the benefit of SSI Exemption in respect of the diaries cleared to LIC - Appeal allowed - decided in favor of appellant.

Summary

Issues:
Interpretation of small scale exemption under Notification No. 08/2018-CE for printed diaries bearing brand name of another person.

Detailed Analysis:
The appeal in question was against an Order-in-Appeal regarding the denial of small scale exemption benefit under Notification No. 08/2018-CE dated 01/03/2003 for printed diaries bearing the brand name of Life Insurance Corporation of India (LIC). The appellant, engaged in printing stationery, executed orders for printing diaries for LIC during 2006-2007. The Department contended that the appellant was not entitled to the exemption as the diaries bore the brand name of LIC, leading to a demand for Central Excise Duty. The impugned order upheld the denial of the exemption, resulting in the appeal being filed.

During the appeal hearing, the appellant did not appear, while the Revenue was represented by the Ld. DR. The appellant submitted a letter requesting the appeal to be decided based on the grounds raised and written submissions. The Revenue reiterated the findings of the impugned order, emphasizing that the diaries printed for LIC bore its name and logo, constituting affixing of a brand name.

The Notification No.08/2003 specified that the exemption would not apply to goods bearing the brand name of another person. The appellant argued that for a brand name to disqualify the exemption, it must indicate a relation between the product and the manufacturer or trader in the course of trade. They contended that as LIC was not a manufacturer or trader of diaries, the brand name on the diaries did not fall within the scope of the notification. The appellant relied on a CBEC circular clarifying the conditions under which the provisions relating to brand names would apply.

The CBEC circular stated that the provisions on brand names would apply only if the brand name is indicated in connection with branded goods and a person using it in the course of trade. As LIC was in the life insurance business and not a manufacturer or trader of diaries, the Tribunal concluded that the provisions relating to brand names did not apply in this case. Therefore, the Tribunal held that the appellant was entitled to the benefit of the small scale exemption for the diaries cleared to LIC, setting aside the impugned order and allowing the appeal.