Brand name use bars small scale exemption, while installation charges are excluded and after-sales service charges included in assessable value.

Use of another person's brand name disentitles a manufacturer to small scale industry exemption where the notification bars such use; however, the extended limitation period cannot be invoked once the Department has knowledge of the brand ownership, so demand survives only for the earlier period. Installation charges are excluded from assessable value because they do not form part of the goods' price, but after-sales service charges are includible in assessable value. The matter was remanded for recomputation of duty on the sustained period, with the penalty set aside and liberty to impose a fresh penalty after recalculation.

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Issues: (i) Whether use of another person's brand name disentitled the assessee to small scale industry exemption and whether the extended demand was barred by limitation. (ii) Whether installation charges and after-sales service charges formed part of the assessable value.

Issue (i): Whether use of another person's brand name disentitled the assessee to small scale industry exemption and whether the extended demand was barred by limitation.

Analysis: The brand name 'Handi Gas' was found to belong to the other concern, and the assessee did not dispute that position. Use of a brand name belonging to a person not entitled to the exemption attracts the bar in the notification. On limitation, once the Department had knowledge from the other concern's statement that the brand name belonged to that concern, suppression could not be alleged for the later period, especially when classification lists continued to be approved thereafter on that basis.

Conclusion: The assessee was not entitled to the exemption on the brand name issue, but the demand for the period after departmental knowledge was barred by limitation. The demand was sustained only for the earlier period.

Issue (ii): Whether installation charges and after-sales service charges formed part of the assessable value.

Analysis: Installation charges were treated as outside the assessable value, while after-sales service charges were held to be includible in the assessable value of the goods.

Conclusion: Installation charges were excluded from assessable value, whereas after-sales service charges were rightly included.

Final Conclusion: The matter was remanded for recomputation of duty for the period sustained, with exclusion of installation charges, and the penalty was set aside with liberty to impose a fresh penalty on recalculation.

Ratio Decidendi: Use of another person's brand name disentitles a manufacturer to small scale industry exemption, but once the Department has knowledge of the facts, the extended period cannot be invoked on suppression; installation charges are not includible in assessable value, whereas after-sales service charges are.

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