SSI exemption available or not_packing in customer's printed boxes

[Guest]

Dear Experts

Please suggest!!

If my customer has supplied printed cartoon boxes nothing else, means i am procuring the goods at my own and manufacturing the same. After manufacturing i packed the material in Printed Cartoon Boxes which has already supplied by my customer, Then Whether Still i am eligible to take benefit of 150 lakhs on this particular transaction, Whether Excise duty be chargeable or not.???

Thank you in advance..!!

[Rajagopalan Ranganathan]

Sir,

There are judgments/decisions both for and against the eligibility of SSI exemption.

1. In Malawa Ram Handa v. CCE [2001 (136) ELT 629 (CEGAT)] = 2000 (4) TMI 626 - CEGAT, NEW DELHI it was held that putting a tag 'TISCON' (belonging to TISCO) along with details of IS No., Lot No., size and name of TISCO on bundles of bars manufactured for TISCO is 'branding'. the brand need not be on goods.

2. It is held in Khanna Industries v. CCE [1996 (82) ELT 109 (CEGAT)], = 1995 (12) TMI 108 - CEGAT, NEW DELHIFiletech Pharma v. CCE [2000 (120) ELT 372 (CEGAT)], = 2000 (5) TMI 85 - CEGAT, COURT NO. II, NEW DELHI use of brand name even on packing of goods is sufficient to hold that branded goods are cleared.

Contra decisions; -

1.In CCE v. S.P. Tools [2005 (183) ELT 323 (CEGAT)] = 2005 (1) TMI 182 - CESTAT, NEW DELHI it was held that SSI exemption is available even though assessee was using packing slips with monogram of another person. the mono gram is not embossed on the excisable products.

Therefore the query raised by you is arguable one and only adjudication by quasi judicial authorities alone can decide the issue. You can clear the goods without payment of duty for time being and if any show cause notice is issued then you can contest the same citing the contra decision which is in favour of you.

[KASTURI SETHI]

INTERIM REPLY

In this context, before arriving at any decision, it is very important to peruse following Board's circular :-

Letter F.No. 354/124/2008-TRU, dated 1-9-2008 Central Board of Excise & Customs, New Delhi

Subject : Instructions on implementation of changes carried out to Notification No. 8/2003-C.E., dated 1-3-2003 - Regarding.

 

 

 

[Mahir S]

Premji,

Whether the issue has been raised by you for the purpose of clarity or any notice has been issued by the department.

[Guest]

Mahir Sir, This issue has been challenged by the Deptt.

Thank you All Experts..!!

AI Summary

SSI exemption uncertain where customer supplied printed packaging is used; conflicting precedents affect excise chargeability. Whether the SSI exemption applies when customer supplied printed cartons are used depends on whether third party branding on packing is treated as branding of the excisable goods; tribunal and appellate authorities are split, so the issue is arguable and requires adjudication. Practitioners should consult the relevant CBEC instructions and may clear goods without paying duty while contesting any show cause notice by relying on favourable precedents.