2000 (7) TMI 198 - AT - Central Excise

Appeal denied for small-scale exemption due to affixing ineligible brand names on products

The appeal by M/s. Ashwin Enterprises regarding eligibility for small-scale exemption under Notification No. 175/86-C.E. was dismissed by the Appellate ... Small-scale exemption under Notification No. 175/86-C.E. - Product bearing brand of ineligible manufacturer - Affixing brand name by job worker - Para 7 of Notification No. 175/86-CE attracting exemption bar - Tribunal Larger Bench precedent bindingSmall-scale exemption under Notification No. 175/86-C.E. - Product bearing brand of ineligible manufacturer - Para 7 of Notification No. 175/86-CE attracting exemption bar - Tribunal Larger Bench precedent binding - Eligibility for small-scale exemption where choke covers were affixed with the brand name of ineligible persons - HELD THAT: - The Tribunal applied its Larger Bench decision in Namtech Systems & Ors. v. CCE, Bangalore, holding that where the covers of chokes were affixed with the brand name of ineligible manufacturers, the goods are not entitled to the small-scale exemption under Notification No. 175/86-C.E. The court observed that a choke cannot lawfully carry the brand name of another (ineligible) manufacturer and relied on the principle that para 7 of the notification is attracted when goods are sold in containers or with marks indicating the brand of an ineligible person. The Tribunal also noted precedent in Unity Paints & Chemicals Pvt. Ltd. v. CCE, where stencilling the customer's name/address on containers was treated as affixing the brand of an ineligible person, thereby disentitling the product from the exemption. Applying these precedents to the facts, the Collector (Appeals) correctly denied the exemption and the Tribunal found no reason to interfere.Benefit of the small-scale exemption under Notification No. 175/86-C.E. is not available where choke covers were affixed with the brand name of ineligible persons; appeal dismissed.Final Conclusion: The Tribunal affirmed the Collector (Appeals) by applying the Larger Bench precedent that affixing the brand of ineligible persons on the choke covers attracts para 7 of Notification No. 175/86-C.E., disqualifying the goods from small-scale exemption; the appeal is dismissed. The appeal by M/s. Ashwin Enterprises regarding eligibility for small-scale exemption under Notification No. 175/86-C.E. was dismissed by the Appellate Tribunal CEGAT, New Delhi. The Tribunal found that affixing the brand name of ineligible persons on choke covers made the appellant ineligible for the exemption. The decision was based on a Larger Bench decision of the Tribunal and previous case law. The appeal was dismissed as the matter was deemed to be correctly decided by the Collector of Central Excise (Appeals).