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TMI Blog2016 (3) TMI 70X X X X Extracts X X X X X X X X Extracts X X X X ..... anufacture under Section 2(f) of the Central Excise Act, 1944, namely; Inspection and testing, Cleaning and lint brushing, Jewellery correction, Activities relating to spectacles and frames (placing in case, tightening screws on eyewear), Folding and hanging, Tagging, Inserting freebies, Placing the product in original box / pack, Inserting warranty cards, Inserting moisture absorbing tablets, Inserting bookmark, Debundling, Sorting, Wrapping, Sensitive material covering, Bagging, Bundling, set creation and rubber banding, Stickering, Boxing, Stuffing and adding dunnage to glassware, Taping, Consignee detailing and Cardboard foot printing. - Ruling No. AAR/CE/ 05 /2016, Application No. AAR/44/CE/ 29 /2013 - - - Dated:- 19-2-2016 - V S Sirpurkar, Chairman, S S Rana, Member And R S Shukla, Member For the Applicant : Shri Tarun Jain Shri Shankey Agarwal, Advs For the Respondent : Shri Amresh Jain(AR) RULING M/s Amazon Wholesale (India) Private Ltd (hereinafter also referred to as the applicant) is a private limited company incorporated in India under the Companies Act, 1956 and the Companies Act, 2013. The main objects of the applicant inter alia includes; to c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nufacturers, hold inventory on its own account and sell the same to retailers, industrial users or other wholesalers. Effectively, the applicant will be involved in the activity of buying and selling the goods on a B2B basis. Applicant proposes to set up warehouses(s) to store the goods purchased from the manufacturers/channel partners ('Manufacturer(s)') at the warehouse(s). Applicant will be undertaking the activity of assortment, packing, wrapping, folding, inspection, cleaning and stickering on the goods purchased from the manufacturers and will subsequently sell the goods to retailers, industrial users or wholesalers. The proposed activities would be carried out at the time of inbound shipment of goods into the warehouse or on shipment of goods to the customer or on customer returns. The applicant may charge additional consideration/fees for undertaking (certain) proposed activities, the additional consideration/fees charged, if any, would be subject to Service Tax. The activities on which the ruling is being sought by the applicant would be undertaken at the said warehouse(s) or at other warehouses operated/ to be operated by the applicant or at third party locations ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... identifier. The blank stickering is typically not required after a packing. III. Quality Check Stickering: If goods in the applicant's warehouse are identified to be defective or not in compliance with their description, they are sidelined for inspection by the quality control team. A quality check sticker is affixed on such goods for identification purpose. 6. Revenue submits that ASIN and Blank Stickering may not amount to manufacture as it is done only to provide the description about the product. However, if the stickering includes even affixing / altering MRP, then it may amount to manufacture depending on case to case basis. It is observed that the applicant has made it clear that the proposed activities would not involve affixation, alternation or change in the MRP/RSP of any product/item received in the warehouse. Further, all items, where required, would already have on MRP/RSP affixed or pre-printed. In view of this, activity of ASIN and Blank stickering will not amount to manufacture under Section 2 (f) of Central Excise Act, 1944. 7. Revenue submits that affixing of Quality Check Stickering may not amount to manufacturing. However if the quality checking/te ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stomer returns, screws at the temples and hinges on the eyewear can become loose during storage. Such screws are tightened with the help of a screwdriver. This activity may also be carried when the items are received from Manufactures and it is noticed that the screws are loose. 11. Revenue submits that when suitable lenses are fitted in frames, only the product can be sold as spectacles/sunglasses. This activity is rendering the product marketable since without proper lenses, the said product can be treated merely as frame and not as spectacles/sunglasses and cannot be sold to the customer. Also a differently known distinct commercial product comes into existence. Applicant relied upon Hon'ble Calcutta High Court judgment in case of Bholanath Sreemony Vs Additional Commissioner of Commercial Taxes and other MANU/WB/0397/1978 wherein it was observed that it cannot, by any stretch of imagination, be held that the petitioner is a manufacturer of spectacles by assembling of frames of the spectacles and thereafter upon prescription fitting glasses to individual frames and then selling them to the customers. Assembly of parts of the frames does not create something new and hence ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mbossed on the jewellery or article itself but appears on the packing such as the jewellery box or pouch or even on the warranty card or certificate of quality, such goods will not be treated as branded jewellery and thus will not be liable to excise duty. The clarification issued in this regard vide D.O.F. No. B-1/3/2011-TRU, dated the 25th March, 2011 stands modified to this extent. 14. It is observed that as per the clarification dated 02.03.2012 issued by CBEC, if brand name is not affixed or embossed on the jewellery but appears on the packing, such as jewellery box or pouch or warranty card or certificate of quality, such goods will not be treated as branded jewellery and thus will not be liable to excise duty. In the instant case, applicant has submitted that the tag is applied by them while placing the jewellery in the box to prevent return of counterfeit items. Application does not mention that applicant would affix or emboss brand name on the jewellery. Tagging in this case is not embossing or affixing. Therefore, the activity of tagging of jewellery would not amount to manufacture under Section 2(f) ibid. 15. In view of the above, we hold that following activitie ..... X X X X Extracts X X X X X X X X Extracts X X X X
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