Tribunal reclassifies multimedia speakers, upholds SSI exemption for GE.

The Tribunal ruled in favor of M/s Global Enterprises, setting aside the lower authority's classification of multi media speakers with FM radio under the Central Excise Tariff. It determined that the main function of the product was sound amplification, classifying it as speakers under CETH 85184000 rather than as held by the Revenue. Additionally, the Tribunal found that the usage of brand names by GE did not constitute manufacture, and clarified that the SSI exemption applied to GE's manufacturing of multi media speakers with their brand name "EXCEL." The Tribunal dismissed the Revenue's appeals for penalties based on these findings.

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Issues:
Classification of multi media speakers with FM radio under Central Excise Tariff
Usage of brand name of others by GE in the manufacture of multi media speakers
Applicability of SSI exemption for products manufactured by GE

Classification of multi media speakers with FM radio:
The case involved the classification of multi media speakers with FM radio under the Central Excise Tariff. The dispute was whether these speakers should be classified under CETH 85279990 as held by the Revenue or under CETH 85184000 as contended by GE. The Tribunal analyzed the product, which included two speakers and a woofer with built-in FM radio. It compared this product with multi media speakers + sub-woofer without FM radio and found them almost identical. The Tribunal disagreed with the lower authority's classification, stating that the FM radio was an additional feature and the main function of the product was amplifying sound, leading to the classification as speakers. It cited a similar case decided by the Tribunal and affirmed by the Supreme Court to support its classification decision.

Usage of brand name of others by GE:
Another issue was the usage of brand names of buyers on multi media speakers purchased from M/s Krishna Technologies and M/s JMD Computers by GE. The Tribunal noted that the show cause notice did not propose a demand on the combined turnover of GE and the other companies. It found that the process of printing brand names and packing undertaken by GE did not amount to manufacture in this case. Referring to relevant legal precedents, the Tribunal determined that mere printing of brand names or packing did not constitute manufacture unless a different commercial commodity came into existence. It concluded that there was no usage of another person's brand name in this situation.

Applicability of SSI exemption for products manufactured by GE:
Regarding the applicability of the SSI exemption for products manufactured by GE, the Tribunal noted that heading 8518 (speakers) was not covered in the Schedule III of the Central Excise Act for "deemed manufacture." It found that printing brand names and packing alone could not be considered as manufacture. The Tribunal observed that GE had manufactured multi media speakers with their brand name "EXCEL" within the exemption limit for small-scale units. It clarified that the presence of another brand name on the speakers marketed by GE did not constitute the usage of another person's brand name.

In conclusion, the Tribunal set aside the impugned order, allowing the appeal of M/s Global Enterprises on the issues of classification of multi media speakers and usage of brand names of others. It directed re-verification of the SSI exemption applicability for the products manufactured by GE and dismissed the appeals by Revenue for penalties on various individuals based on the findings.

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