SSI exemption remains available when dutiable branded job-work clearances are excluded from the bar on eligible own clearances.

Dutiable clearances of branded goods manufactured for third parties on job-work basis were treated separately from the assessee's own eligible clearances for SSI exemption under Notification No. 8/2003-CE. The Tribunal noted that payment of duty on such branded goods, and the use of Cenvat credit on inputs for them, did not by itself disqualify the assessee from claiming the exemption for its own qualifying clearances. Following the Supreme Court and its own earlier coordinate decision, it held that branded job-work clearances do not attract the bar against SSI exemption for eligible goods.

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Issues: Whether the appellant was entitled to SSI exemption under Notification No. 8/2003-CE despite clearing branded goods manufactured for others on payment of duty and availing Cenvat credit on inputs used for such branded goods.

Analysis: The exemption scheme was examined in the light of the principle that clearances of goods manufactured bearing the brand name of third parties on job work basis are to be treated separately from the assessee's own exempt clearances. Once duty is paid on such branded goods, they do not defeat the assessee's entitlement to SSI exemption for its own clearances. The Tribunal followed the law laid down by the Supreme Court and its earlier coordinate decision to hold that branded job-work clearances, though dutiable, do not disqualify the assessee from claiming the notification benefit for eligible clearances.

Conclusion: The appellant was entitled to SSI exemption under Notification No. 8/2003-CE, and the denial of benefit was unsustainable.

Final Conclusion: The impugned order was set aside and the appeal was allowed with consequential relief.

Ratio Decidendi: Dutiable clearances of branded goods manufactured for third parties on job work basis are to be excluded from the bar against SSI exemption for the assessee's own eligible clearances, and such activity does not by itself disentitle the assessee from the exemption.

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