SSI exemption and Cenvat credit remain available where duty-paid branded job-work clearances are excluded from aggregate turnover.

SSI exemption under Notification No. 8/2003-CE was to be determined on a holistic reading of the notification, and duty-paid clearances of goods manufactured on job work for third parties under their brand name were kept outside the aggregate value of the assessee's own clearances. Those branded third-party clearances did not disqualify the assessee from availing SSI exemption for its own goods, and Cenvat/Modvat credit remained available on inputs used in making the duty-paid branded goods.

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Issues: Whether the assessee was entitled to SSI exemption under Notification No. 8/2003-CE while also clearing goods manufactured on job work basis for third parties under their brand name and availing Cenvat credit on inputs used for such branded clearances.

Analysis: The exemption notification had to be read as a whole. On that construction, clearances of goods bearing the brand name or trade name of third parties, which are outside the exemption scheme and on which duty is paid, are not to be clubbed with the assessee's own clearances for determining eligibility to SSI exemption. Such third-party branded job-work clearances do not disqualify the assessee from availing the exemption for its own goods. The assessee is also entitled to Cenvat/Modvat credit on inputs used in the manufacture of such duty-paid branded goods.

Conclusion: The assessee was entitled to SSI exemption and Cenvat credit, and the branded job-work clearances were not includible for denying the benefit.

Ratio Decidendi: For SSI exemption purposes, duty-paid clearances of goods manufactured on job work for third parties under their brand name are to be kept outside the aggregate value of clearances and do not bar exemption on the assessee's own goods.

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