2019 (1) TMI 1855 - AAR - GST

Exemption from payment of GST - supply of products - use of the name of the applicant i.e. General Mills India Pvt. Ltd. on the packaging for supply of products by the applicant solely for the limited purpose of complying with the mandatory requirement under Chapter 2 of FSSAI Regulations and not for the purpose/with the intention of indicating a connection in the course of trade between the products - whether amount to bearing a registered brand name or bearing a brand name on which an actionable claim or enforceable right in a Court of law is available in terms of S. No. 73 of the Notification No. 28/2017-Central Tax (Rate), dated 22 September, 2017? - applicability of exemption under S. No. 73 of Amended Exemption notification if the applicant voluntarily foregoes the brand name used by them. HELD THAT - The applicant is packing their product which are classifiable as Wheat or Meslin flour in unit containers using the name of the applicant i.e. M/s. General Mills India Pvt. Ltd. - The Notification No. 2/2017-Central Tax (Rate), dated 28th June, 2017 (and corresponding notifications under SGST Acts and IGST Act) is the central point of discussion here. The said notifications exempt various goods and services from the payment of duty - Vide Notification No. 28/2017-Central Tax (Rate), dated 22-9-2017 the words other than those put up in unit container and bearing a registered brand name , the words, brackets and letters other than those put up in unit container and, - (a) bearing a registered brand name; or (b) bearing a brand name on which an actionable claim or enforceable right in a Court of law is available other than those where any actionable claim or enforceable right in respect of such brand name has been foregone voluntarily, subject to the conditions as in the Annexure I , were substituted. Therefore, for availing exemption from whole of the duty, the goods shall be other than those goods fulfilling the said conditions mentioned in (a) and (b) - Further, the ruling of the Authority for Advance Ruling under GST, Maharashtra in the case of M/s. Aditya Birla Retail Limited 2018 (8) TMI 1072 - APPELLATE AUTHORITY FOR ADVANCE RULING MAHARASHTRA also supports the said view wherein it was held that Thus proposed change of removing brand name MORE and logo Aditya Birla Retail and replacing it with name Aditya Birla Retails Ltd. is not going to make any difference so far as establishing connection of goods with manufacturers . In the instant case, the applicant is using their name in place of any logo or brand name, which enables the customers to connect the product of the applicant with the name of the manufacturer i.e. General Mills India Pvt. Ltd. Therefore, the above rulings of the Authority for Advance Ruling also applicable in the instant case - the supply of the said product by the applicant is not exempted under the Heading No. 73 of Notification No. 2/2017-Central Tax (Rate), dated 28th June, 2017 and the corresponding notification issued under the UPGST Act, 2017. If the applicant voluntarily forego the enforceable right to such brand name (i.e. the expression General Mills India Pvt. Ltd. ), in the manner as prescribed under the Amended Exemption Notification and claim exemption from payment of GST on supply of products under said S. No. 73 of Amended Exemption notification, whether the applicant will be eligible for exemption under the said notification? - HELD THAT - In the instant case, the applicant is packing their product in unit containers with the name General Mills India Pvt. Ltd. on the packaging for supply of products. Since, Wheat or Meslin flour packed in unit containers are exempted under the said notification only if the manufacturer fulfills the condition (b) of the said notification subject to the conditions as in the Annexure-I - Therefore, it is clear that if the applicant voluntarily foregoes the brand name used by them subject to conditions as in the Annexure-I of the said notification, the applicant shall be eligible for exemption from duty under the said notification.

Summary

Issues:
1. Interpretation of exemption from GST for products bearing a brand name.
2. Eligibility for exemption if the brand name is voluntarily foregone.

Analysis:
1. The applicant, engaged in manufacturing food products, sought clarification on whether the use of their name on packaging, solely for regulatory compliance and not to indicate a trade connection, exempts them from GST under a specific notification. The Authority analyzed the definition of a brand name under GST law, emphasizing the connection between the manufacturer's name and the product. Referring to a similar case, the Authority ruled that using the manufacturer's name on packaging establishes a trade connection, making the products ineligible for the claimed exemption. Therefore, the supply of products by the applicant does not fall under the exemption notification.

2. The second issue raised by the applicant concerned voluntarily forgoing the brand name to claim exemption from GST. The Authority highlighted the conditions specified in the notification for such voluntary action, including filing an affidavit with the tax authority and clearly printing the foregone brand name on packaging. It was concluded that if the applicant fulfills these conditions, they would be eligible for the exemption. The ruling affirmed that compliance with the conditions in Annexure-I of the notification would allow the applicant to be exempted from tax, provided the enforceable right to the brand name is voluntarily relinquished.

This detailed analysis of the judgment provides insights into the Authority's interpretation of the exemption provisions under GST law and the conditions for claiming such exemptions related to brand names on product packaging.