2017 (5) TMI 561 - AT - Central Excise

SSI exemption - N/N. 8/2003-CE dated 01.03.2003 - use of brand name of others - Held that - reliance placed in the case of Nebulae Health Care Ltd. 2015 (11) TMI 95 - SUPREME COURT , wherein it has been held that the goods cleared with the brand name of others on payment of duty are eligible for the benefit of N/N. 8/2003-CE dated 01.03.2003 - appellants are entitled for benefit of exemption N/N. 8/2003-CE dated 01.03.2003 - appeal allowed - decided in favor of appellant.

Summary

Issues:
Appeal against denial of exemption under Notification No. 8/2003-CE dated 01.03.2003 for manufacturing goods in own brand and brand name of others.

Analysis:
The appellants appealed against the denial of the benefit of exemption under Notification No. 8/2003-CE dated 01.03.2003 for manufacturing goods in their own brand and in the name of others. The Revenue contended that manufacturing goods with the brand name of others disentitles them from the exemption. The issue was settled by the Hon’ble Apex Court in Nebulae Health Care Ltd. case, where it was clarified that goods cleared with the brand name of others on payment of duty are eligible for the benefit of the said Notification. The Tribunal analyzed the scheme of the Notifications and concluded that the SSI Unit manufacturing branded goods for third parties on job work basis should be regulated by normal excise provisions, entitling them to Cenvat/Modvat credit on inputs used for such goods. The Tribunal emphasized that the Notifications exclude clearances bearing brand names of third parties from determining the aggregate value for exemption. The Tribunal upheld the appeal, setting aside the impugned order and allowing the benefit of the exemption.

Conclusion:
The Tribunal's decision in the appeal clarified that manufacturing branded goods for third parties on job work basis does not disentitle an SSI Unit from availing the benefit of exemption under Notification No. 8/2003-CE dated 01.03.2003. The judgment highlighted the distinction in treatment between goods manufactured in own brand and those in the brand name of others, emphasizing the eligibility for Cenvat/Modvat credit in the latter case. The Tribunal's analysis of the Notifications and the precedent set by the Hon’ble Apex Court in Nebulae Health Care Ltd. case supported the appellants' entitlement to the exemption. The appeal was allowed, providing consequential relief to the appellants in line with the settled legal position.