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TMI Blog2017 (6) TMI 971X X X X Extracts X X X X X X X X Extracts X X X X ..... ed in para 2(iii) of the N/N. 8/2003 - Appeal dismissed - decided against appellant. - E/364/2007-DB - 20752/2017 - Dated:- 24-5-2017 - Shri SS Garg, Judicial Member And Shri V. Padmanabhan, Technical Member Shri Raghavendra B Hanjeer, Advocate for the appellant. Shri N. Jagadish, Superintendent(AR) for the respondent. ORDER Per: V. Padmanabhan The appeal is against Order-in-Appeal No.19/2007 dt. 27/02/2007. The appellant is engaged in the manufacture of tyres. The tyres are cleared under their own brand name and also in the brand name of JK Tyres Ltd. The period of dispute is 01/04/2005 to 31/12/2005, during which the appellants cleared the tyres with the brand name of JK Tyres, on payment of full rate of duty. However, in respect of tyres cleared with their own brand name, the appellants availed benefit of SSI Notification No.8/2003-CE dt. 01/03/2003. Benefit of this Notification was available Subject to the condition that no credit of duty on inputs under Rule 3 or Rule 11 of the CENVAT Credit Rules 2002 is availed. The appellant was availing such credit on inputs and at the time of clearance of tyres with their own brand name without payment of dut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appellant has chosen to come within the fold of Notification No.8/2003. It is on record that they have also availed the CENVAT credit. As such, they have contravened the conditions of notification and hence the lower authorities have rightly withdrawn the benefit of SSI notification. He relied upon the following case laws:- i. CCE, Ahmedabad Vs. Ramesh Food Products [2004(174) ELT 310 (SC)] ii. CCE, Chennai Vs. Nebulae Health Care Ltd. [2015(325) ELT 431 (SC)] iii. CCE C, Raipur Vs. National Cement Corporation [2012(286) ELT 21 (Chhattisgarh)] iv. Kamani Foods Vs. CCE, Patna [1995(75) ELT 202 (Tri.)] 7. In particular, he drew our attention to the decision of the Hon'ble Supreme Court in the case of Nebulae Health Care Ltd. (supra) in which the Apex Court has considered similar facts and categorically held that manufacture of branded goods of third party on job work basis did not come within the ambit of SSI exemption. The Apex Court has allowed the benefit of SSI exemption for own goods only since the assessee in that case maintained separate accounts and availed CENVAT credits only to the extent of goods cleared on job work with brand name ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ad been held as follows: 10. Notification 175/86 have to be read as a whole and as noted rightly, in Kharia Cement Works case (supra) sub-clauses (i) and (ii) have to be construed harmoniously. Exemption envisaged for the specified goods accrues to them through instrumentality of the manufacturer. The notification clearly demarcated the two categories of manufacturers. A clear cut distinction is explicit between a manufacturer availing Modvat credit under Rule 57A and another not opting for the Modvat Scheme. As is statutorily provided, input duty relief is given under the scheme to the manufacturers who opt to operate under the scheme by applying for it in the prescribed manner. Ultimately the manufacturers have the choice of choosing one of the two concessions, i.e. either The Modvat Scheme or Notification 175/86. Further, there is no one to one correlation between the inputs and final products under Modvat Scheme. It would therefore not possible to allow the manufacturer to simultaneously avail Modvat for some products and avail full exemption for others under small-scale exemption scheme. 10. The Apex Court also dealt with their own decision in the case of Ramesh Food ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... usly. Therefore an SSI unit availing full exemption as per the Notfn. No.175/86 in respect of certain specified goods could not also avail the modvat benefit in respect of certain other specified goods. 8.1 Notfn. No.175/86, dated 1-3-1986 extended concessional rate of duty on first clearances of specified goods of value of rupees seven and half lakhs while availing modvat credit on inputs or full exemptions benefit for such goods without the benefit of modvat credit. The Notfn. also provided lesser benefit for further clearances in excess of the above aggregate value under both the options for higher slabs/aggregate value of clearances. In computing the aggregate value of clearances for the purposes of exemption under both the options, the notification did not require that the goods bearing brand name of third parties should be excluded. The following explanations, inter alia, governed computation of the above aggregate value for the Notfn. Explanation IV - For the purposes of this notification, where the specified goods manufactured by a manufacturer, are affixed with a brand name or trade name (registered or not) of another manufacturer or traders, such specified goods ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al. 19. We, accordingly, uphold the view of the Tribunal in both the decisions, result whereof is to dismiss these appeals. Ordered accordingly. There shall, however, be no order as to costs. 11. The conclusion arrived at by the Apex Court is that an assessee who wishes to avail SSI benefit under Notification no.08/2003 as well as pay duty on branded goods will be eligible to CENVAT Credit only in respect of those goods which are cleared bearing the brand name of another for which full payment of duty without concession is specified. 12. In terms of the Notification No.8/2003, the SSI benefit will be eligible only if no CENVAT credit is availed. In the present case, we find that the CENVAT credit on inputs stand availed for those which are used commonly for branded and other goods. The appellant has made a feeble attempt to satisfy the condition of the notification by reversing an amount @ 10% of the value exempted goods, as provided in Rule 6(3) of the CENVAT Credit Rules 2004. We are afraid that the prescription made in CENVAT Credit Rules cannot be imported into the conditions of Notification No.8/2003. We are convinced that the appellant has failed to satisfy the c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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