2017 (7) TMI 444 - AT - Central Excise

Tribunal rules against SSI exemption for loose cookies linked to Cookie Man brand name.

The Tribunal ruled in favor of the Revenue, setting aside the impugned order and restoring the Order-in-Original, allowing the appeal filed by the ... SSI exemption - use of brand name - respondents were clearing unbranded cookies and cookies bearing the brand name Cookie Man - Revenue was of the view that that the cookies sold in paper plate and in napkins are also to be treated as branded cookies as the buyer buying such cookies from the outlet are aware that the cookies sold loosely is only Cookie Man cookies and that they are the very same item that are sold in packs, denying the benefit of N/N. 8/2003 dated 01.03.2003 on these cookies - whether the respondents are eligible for the benefit of SSI exemption on the cookies sold loose in their outlets? - Held that: - In the respondent's own case, the Hon’ble Apex Court has held that the respondents would not be eligible for the benefit of SSI exemption even for the cookies sold in loose from their outlets - assessee are having an exclusive shop in Spencer Plaza complex and they are the license holder of the brand Cookie Man outlet as per the agreement with Cookie Man Pty. Ltd., Australia - demand upheld - appeal allowed - decided in favor of Revenue. Issues involved:1. Eligibility for SSI exemption on cookies sold loose in outlets.Analysis:The case involved respondents engaged in manufacturing cookies under Central Excise Tariff heading 1905.11, cleared on payment of duty under Section 4A of Central Excise Act, 1944. They sold branded cookies, loose cookies in empty boxes, and loose cookies in paper plates and napkins. The dispute arose when the department contended that cookies sold loosely should also be treated as branded cookies, thus not eligible for exemption under Notification No. 8/2003. A show cause notice was issued, leading to duty demand confirmation, interest imposition, and penalty by the original authority. The Commissioner (Appeals) initially ruled in favor of the respondents based on a Tribunal's decision in a similar case.The Ld. AR for the department highlighted a subsequent judgment favoring the Revenue in a different case. The issue in question was whether the respondents qualified for SSI exemption on loose cookies sold in their outlets. The respondents operated an exclusive shop in Spencer Plaza complex under a brand license agreement with Cookie Man Pty. Ltd., Australia. The Apex Court previously ruled that even loose cookies sold from their outlets did not qualify for SSI exemption. The Court emphasized that goods need not bear a trade or brand name to be considered branded, and various factors, including the selling outlet, were crucial in determining branding. The judgment concluded that the cookies, even when sold without brand inscription, maintained a clear connection with the brand name, Cookie Man, and thus were not eligible for exemption.Ultimately, the Tribunal ruled in favor of the Revenue, setting aside the impugned order and restoring the Order-in-Original, allowing the appeal filed by the Revenue. The decision was pronounced in the Open Court on 21.06.17.