Brand name clearances count toward SSI exemption limit where the brand owner is itself eligible for relief.

Clearances of goods bearing another person's brand name were not excludible from aggregate turnover for small scale exemption under Notification No. 1/93-C.E. Explanation III applies only where the brand name owner is not itself eligible for the exemption, and that condition was not met because the owner was eligible for SSI relief. Eligibility for the subsequent year had to be tested on the facts existing in that year, so the assessee could not exclude the branded clearances and was not entitled to the notification benefit.

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Issues: Whether the value of clearances of goods bearing the brand name of another person was to be excluded while computing the aggregate value of clearances for eligibility to small scale exemption under Notification No. 1/93-C.E.

Analysis: Paragraph 3 of Notification No. 1/93-C.E. denies the exemption where the aggregate value of clearances in the preceding financial year exceeds the prescribed limit. Explanation III excludes clearances of goods affixed with the brand name or trade name of another person only where that other person is not eligible for the exemption under the notification. Since the brand name owner was itself eligible for SSI exemption, the condition in Explanation III was not satisfied. The computation of eligibility for the subsequent year had to be made on the basis of the position obtaining in that year, and the exclusion claimed by the assessee was therefore unavailable.

Conclusion: The branded clearances were not excludible, and the assessee was not entitled to the benefit of the notification.

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