2005 (10) TMI 148 - AT - Central Excise

Tribunal reverses denial of SSI notification benefit, emphasizing appellant's independence & excluding marketing charges from clearance.

The Tribunal overturned the decision to deny the SSI notification benefit, emphasizing the independence of the appellant as a manufacturer and the ... SSI Exemption - Value of clearances Issues:1. Denial of benefit of SSI notification based on brand name usage and clearance value exceeding limit.2. Inclusion of marketing service charges in clearance figures.3. Independence of units and applicability of SSI notification.Analysis:1. The appeal arose from an Order-in-Original confirming demands against the appellant by denying the benefit of SSI notification due to the usage of M/s. Kissan Products' brand name. The Commissioner noted that the appellant had the brand name assigned in their favor, hence the benefit could not be denied. However, the benefit was denied based on M/s. Kissan Products' previous year's clearances exceeding the limit. The Tribunal held that the appellant, despite using M/s. Kissan Products' premises, operated independently, and the clearance figures should be considered separately. The earlier Order-in-Appeal had established the independence of the appellant and M/s. McDowell, hence adding marketing charges collected by M/s. McDowell to the appellant's assessments was deemed improper.2. The learned Counsel argued that the marketing service charges were unrelated to the goods manufactured by the appellant and should not have been included in the clearance figures. Citing legal precedents, it was emphasized that such charges should not be added to the assessable value. The Tribunal concurred, stating that the marketing charges were for a different downstream product and should not affect the appellant's SSI eligibility. The appellant's clearances, after availing exemptions, did not exceed the limit, thus no grounds existed to deny the benefit of the notification.3. The Tribunal agreed with the Counsel's submissions, highlighting the independence of the appellant as a manufacturer. Despite using M/s. Kissan Products' machinery, the appellant's clearances were to be considered independently. The inclusion of marketing charges in the clearance figures was deemed incorrect, as they were not related to the appellant's manufactured goods. The Tribunal set aside the impugned order, concluding that the denial of the SSI notification benefit was unwarranted based on the presented facts.In conclusion, the Tribunal overturned the decision to deny the SSI notification benefit, emphasizing the independence of the appellant as a manufacturer and the inapplicability of including unrelated marketing charges in clearance figures.