2012 (8) TMI 656 - AT - Central Excise

Whether indicating the name of the manufacturer on the packaging of the product would amount to affixing a brand name or not - SSI exemption Held that - In respect of the packaged goods, there are statutory requirements that the manufacturer s or packer s name and address should be indicated on the packages of the goods under the standards of Weights & Measures Act, 1976 and the rules made thereunder. Indicating the names and address of the manufacturer on the packages cannot be construed as affixing the brand name - appellant is entitled for the benefit of exemption

Summary

Issues:
Whether indicating the name of the manufacturer on the packaging of the product would amount to affixing a brand name for the purpose of eligibility to small scale exemption under Notification No. 9/99-C.E. dated 28-2-1999.

Analysis:
The case involved a dispute regarding the eligibility of a company, M/s. Synotex Industries, for small scale exemption under Notification No. 9/99-C.E. dated 28-2-1999. The core issue was whether indicating the name of the manufacturer on the product packaging constituted affixing a brand name, thereby affecting the company's eligibility for the exemption. M/s. Synotex Industries had chemicals manufactured on job work basis by another company, M/s. Allied Chromes & Chemicals, and marketed them. The packaging of the products displayed "manufactured by M/s. Allied Chromes and Chemicals (P) Ltd." and "marketed by M/s. Synotex Industries." The Department contended that mentioning the manufacturer's name on the packages constituted affixing a brand name, disqualifying the company from the exemption.

The original adjudicating authority denied the benefit of the notification and imposed a duty demand on M/s. Synotex Industries. However, the Commissioner (Appeals) overturned this decision, citing judgments from previous cases. The Lower Appellate Authority, relying on precedents like Rajdoot Paints Ltd. v. Collector of Central Excise and Kalvert Foods India Pvt. Ltd. v. Commr. of C. Ex., concluded that the manufacturer's name on the packages was a house mark and not a brand name, thus allowing the exemption for M/s. Synotex Industries.

The Revenue appealed against the Commissioner (Appeals) order, arguing that mentioning the manufacturer's name constituted a brand name, making the company ineligible for the exemption. The Tribunal analyzed the situation and rejected the Revenue's contention. The Tribunal emphasized that statutory requirements mandate the inclusion of the manufacturer's name on product packages under the Weights & Measures Act, 1976. The Tribunal concluded that merely indicating the manufacturer's name does not amount to affixing a brand name, as established in previous judgments. Citing the cases of Rajdoot Paints Ltd. and Kalvert Foods India Pvt. Ltd., the Tribunal upheld the Commissioner (Appeals) order, dismissing the Revenue's appeal and disposing of the cross objection.

In summary, the Tribunal ruled that indicating the manufacturer's name on product packaging does not constitute affixing a brand name, thereby affirming the company's eligibility for the small scale exemption under Notification No. 9/99-C.E. The decision was based on statutory requirements and precedents from previous cases, emphasizing that mere mention of the manufacturer's name is not equivalent to branding the product.