Brand name on packaging can place goods outside small scale industry exemption for the relevant period

Printed cartons and skin packaging bearing another's brand name were treated as branded goods because a brand or trade name used in the course of trade to indicate a connection between the goods and the mark owner takes the goods outside the exemption for unbranded clearances. On that reasoning, their value was not required to be added to aggregate clearances for small scale industry exemption under Notification No. 8/2002-CE for the relevant period. The later amendment excluding such goods from the benefit only from 01/09/2008 did not apply to the dispute period.

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Issues: Whether the value of printed cartons and skin packaging bearing another's brand name was liable to be included in the aggregate value of clearances for availing small scale industry exemption under Notification No. 8/2002-CE.

Analysis: The applicable notification defined "brand name" or "trade name" as a mark used in relation to specified goods to indicate a connection in the course of trade between the goods and the person using the mark. The controlling principle, as applied by the Court, was that exemption is lost when the brand or trade name is used in the course of trade to indicate such a connection, even if the goods are manufactured for a buyer and are not themselves traded in the open market. On that basis, printed cartons bearing the buyer's brand name were treated as branded goods. The later amendment excluding such goods from the benefit only from 01/09/2008 did not govern the period in dispute.

Conclusion: The printed cartons and skin packaging bearing another's brand name were branded goods, and their value was not liable to be added for SSI exemption purposes for the relevant period.

Final Conclusion: The orders of the lower authorities were set aside and the assessee's appeals succeeded with consequential relief.

Ratio Decidendi: Where a brand or trade name is used in the course of trade to indicate a connection between the goods and the person using the mark, the goods fall outside the exemption meant for unbranded clearances.

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