1997 (12) TMI 213 - AT - Central Excise

Summary

Issues:
1. Applicability of Notification No. 175/86-C.E. to soaps carrying the brand names of customers.
2. Interpretation of the definition of "brand name" in the Notification.
3. Determination of whether the benefit of the Notification can be denied based on the use of brand names.
4. Consideration of whether trading in goods takes place in the given scenario.
5. Analysis of the Circular issued by the Board regarding the application of brand name provisions.

Analysis:
The judgment dealt with the issue of whether the benefit of Notification No. 175/86-C.E. could be extended to soaps manufactured by appellants carrying the brand names of their customers, such as hotels and airlines. The Revenue had denied the benefit citing para 7 of the Notification, which pertains to the use of brand names of other persons. The appellants argued that since the soaps were used in the customers' establishments and not further sold, the goods were not traded, thus falling outside the scope of the Notification's provisions.

The Tribunal considered the submissions and agreed with the appellants' contention. It was held that as there was no trading in the goods at the end of the customers, para 7 of the Notification did not apply in this case. The Tribunal emphasized that the absence of trade in the goods exempted the appellants from the provisions of the Notification, allowing them to avail the benefits under it.

Furthermore, the judgment referred to a Circular issued by the Board, which clarified the conditions necessary to trigger the brand name provisions. The Circular highlighted that for the brand name provision to apply, there must be a connection between the branded goods and a person using the brand name in the course of trade. It was emphasized that if there is no trade of such goods, the brand name provision would not be applicable.

The Tribunal found the Circular's guidance relevant to the case at hand and ruled in favor of the appellants, granting them the appeals with consequential reliefs. The judgment underscored the importance of the absence of trade in determining the applicability of brand name provisions and the entitlement to Notification benefits, aligning with the interpretation provided in the Circular issued by the Board.