Brand name exemption under Notification 140/83 remained available absent proof of sham manufacturing or non-arm's-length dealings.

Notification No. 140/83, before its amendment by Notification No. 224/87, did not by itself deny exemption merely because goods carried another person's brand name or trade name. Exemption could be refused only where the department established that the manufacturer was not the actual manufacturer, or that the transactions were not on a principal-to-principal basis and at arm's length. On the stated facts, the assessee manufactured goods in its own factory, purchased raw materials independently, and sold the finished goods on principal-to-principal terms, so the exemption remained available and the demand was not sustainable.

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Issues: Whether the assessee was entitled to exemption under Notification No. 140/83 despite affixing the brand name of another person, and whether such exemption could be denied for the period prior to the 22-9-1987 amendment.

Analysis: Notification No. 140/83, as it stood before the amendment introduced by Notification No. 224/87, did not exclude goods merely because the manufacturer affixed the brand name or trade name of another person. The exemption could be denied only if the department established that the manufacturer was not the actual manufacturer or that the dealings were not on principal-to-principal basis and were not at arm's length. No evidence was produced to dislodge the assessee's position that it manufactured the goods in its own factory, purchased raw materials independently, and sold the finished goods on principal-to-principal terms.

Conclusion: The assessee was entitled to the exemption and the demand was not sustainable.

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