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2020 (2) TMI 748 - AT - Central ExciseExemption to specified goods of chapters 50 to 63 - Textile and garments - fixation of Brand Name - whether affixing name, logo and particulars of the buyers such as FCI and State Governments on Hessian Bags/Sacks to comply with the requirement of Jute Control Orders would be treated as affixing of brand name within the meaning of N/N. 12/2011-CE dated 01.03.2011 and N/N. 30/2011-CE dated 24.03.2011? HELD THAT - The dispute involved in all the present appeals stands decided by the Hon ble Supreme Court in the case of M/S. RDB TEXTILES LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE AND SERVICE TAX, KOLKATA-IV COMMISSIONERATE 2018 (2) TMI 825 - SUPREME COURT . The Hon ble Apex Court had examined the wordings of the Notification as it stood during the disputed period and decided that the printing of the name, logo and other particulars of buyer, like FCI and State Governments, were made by the manufacturers to comply with the requirements of Jute Control Order. The Hon ble Supreme Court further held that the markings on jute bags were under compulsion of law and meant for identification, monitoring and control by Government Agencies and such markings cannot be considered as brand name. Accordingly, the Apex Court held that the benefit of N/N. 30/2004-CE will be available during the disputed period. Appeal allowed - decided in favor of appellant.
Issues involved: Whether affixing name, logo, and particulars of buyers on jute bags to comply with Jute Control Orders constitutes affixing a brand name under specific Central Excise Notifications.
Comprehensive Analysis: 1. Issue Identification: The primary issue in this case revolves around determining whether affixing specific information on jute bags, such as the name, logo, and other details of buyers, to adhere to Jute Control Orders, qualifies as affixing a brand name under Notification No.12/2011-CE and Notification No.30/2011-CE. 2. Factual Background: The appellants, manufacturers of jute bags, sought exemption under Central Excise Notification No.30/2004-CE. However, amendments introduced through Notification No.12/2011-CE mandated certain details to be printed on jute bags as per the Jute Commissioner's order. These bags, mainly supplied to entities like Food Corporation of India and State Government Agencies for Public Distribution System use, were deemed branded goods by the department, leading to a show cause notice for Central Excise duty payment, interest, and penalties. 3. Legal Analysis: The Tribunal considered the dispute in light of the Hon'ble Supreme Court's decision in RDB Textiles Ltd. vs. CCE & ST, Kolkata-IV, where it was established that the markings on jute bags were obligatory under the Jute Control Order for identification and control by Government Agencies, not for enhancing the bags' value or indicating a trade connection. The Court clarified that such mandatory markings did not constitute a brand name under the relevant Notifications. 4. Judicial Decision: Given the Apex Court's ruling and the absence of a trade connection indication through the mandatory markings, the Tribunal allowed the appeal, aligning its decision with the Supreme Court's interpretation. The Tribunal emphasized that the compulsion of law for specific bag markings aimed at government identification and control, not commercial branding, making the bags eligible for the Notification No.30/2004-CE exemption during the disputed period. 5. Conclusion: The Tribunal's decision to follow the Supreme Court's precedent in interpreting the applicability of brand name under the Central Excise Notifications to mandatory jute bag markings highlights the importance of legal compliance and the distinction between regulatory requirements and commercial branding in taxation matters.
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