Brand name on food packaging can block GST exemption unless rights are validly foregone under the notification

A manufacturer's name printed on unit-container packaging for food products can amount to a brand name where it indicates a trade connection, so exemption under the GST notification is not available on that basis. The exemption may still apply if the person packing the goods voluntarily foregoes the actionable claim or enforceable right in that brand name by following the prescribed affidavit and declaration requirements. The operative effect is that brand-name use on packaging can defeat exemption unless the notification's conditions for valid relinquishment are met.

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Issues: (i) Whether the use of the applicant's name on unit-container packaging for food products, even if stated to be for compliance with FSSAI requirements, amounts to bearing a brand name so as to deny exemption under the relevant GST notification; (ii) whether the applicant can still claim exemption if it voluntarily foregoes the enforceable right to such brand name in the manner prescribed by the notification.

Issue (i): Whether the use of the applicant's name on unit-container packaging for food products, even if stated to be for compliance with FSSAI requirements, amounts to bearing a brand name so as to deny exemption under the relevant GST notification.

Analysis: The exemption for specified goods packed in unit containers is unavailable where the goods bear a registered brand name or a brand name on which an actionable claim or enforceable right exists. A manufacturer's name printed on packaging indicates a connection in the course of trade between the goods and that person, and is therefore capable of functioning as a brand name for the purpose of the notification.

Conclusion: The use of the applicant's name on the packaging constitutes a brand name, and the claim for exemption on that basis is rejected.

Issue (ii): Whether the applicant can still claim exemption if it voluntarily foregoes the enforceable right to such brand name in the manner prescribed by the notification.

Analysis: The amended exemption notification permits exemption where the person packing the goods voluntarily foregoes the actionable claim or enforceable right in respect of the brand name, subject to compliance with the prescribed affidavit and declaration requirements in the annexure to the notification.

Conclusion: If the applicant complies with the prescribed conditions for voluntary foreclosure of rights, the goods will be eligible for exemption.

Final Conclusion: The ruling treats the applicant's name as a brand name for GST exemption purposes, but recognises availability of exemption upon compliance with the prescribed procedure for voluntary foreclosure of brand rights.

Ratio Decidendi: A manufacturer's name on unit-container packaging can amount to a brand name if it indicates trade connection, and GST exemption for such goods is available only when the actionable claim or enforceable right in that brand name is validly foregone in accordance with the notification's conditions.

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