Customs, Excise and Gold Tribunal - Delhi
Commissioner Of C. Ex. vs Panchsheel Soap Factory on 10 April, 2002
Equivalent citations: 2002(145)ELT527(TRI-DEL)
ORDER
V.K. Agrawal, Member (T).
1. The issue involved in this appeal filed by the Revenue is whether affixing of sticker on a label will amount to manufacture in terms of Note 6 to Chapter 34 of the Schedule to the Central Excise Tariff Act.
2. Shri M.M. Dubey, learned Departmental Representative, submitted that the respondents M/s. Panchsheel Soap Factory imported toilet soaps which were marketed by them after affixing label, containing MRP and their name as importer; that the Additional Commissioner under Adjudication Order No. 16/2000, dated 5-1-2000, confirmed the demand of duty besides imposing the penalty holding that the sticker indicating the name of the importer and the MRP was required to be put as the same was mandatory under Section 33 of Standards of Weights and Measures (Packed Commodity) Act, 1977 and that labelling the products amounts to manufacture in terms of Note 6 to Chapter 34; that, however, on appeal Commissioner (Appeals) set aside the adjudication order holding that the putting of label as described in the show cause notice would not amount to manufacture in terms of Note 6 to Chapter 34. Learned Departmental Representative further submitted that as per Section 2(n) of Standards of Weights and Measures Act, label means any written, marked, stamped, printed or graphic matters affixed to or appearing upon any commodity or package containing any commodity; that as per rules under the Weights and Measures Act, name and address of the manufacturer or packer has to be declared on the packet; that as per that rule when any commodity manufactured outside India, is packed in India, the package shall also contain on principal display panel/ the name and complete address of the packer in India; that taking into consideration the definition of the label given in the said Act, relabelling would mean replacing the original label by a fresh/new label whether by pasting the new label on the old label or by dispensing with the old label and in its place pasting the new one; that it is, thus, apparent that the activity of pasting additional information on the paper package amounts to labelling as defined under the Standards of Weights and Measures Act, and activity undertaken by the respondents is covered by Note 6 to Chapter 34 of the Central Excise Tariff Act, 1985.
3. On the other hand, Shri K. Kumar, learned Advocate, submitted that the mere sticker containing the name of importer and MRP is not a label; that the label, as commonly understood, should contain description of the goods, its character, usage etc. which the sticker, placed by them, does not contain at all; that the term 'relabelling' means pasting a new label in place of existing label or pasting an over label on the existing label so that the existing label disappear. He relied upon the Trade Notice No. 47/96, dated 21-8-96 issued by the CCE, Mumbai wherein it was clarified that the process of pasting of sticker on imported finished goods marketed by the assessee may not be covered by Note 5 to Chapter 30 of the Central Excise Tariff Act, 1985. He, further, submitted that this Trade Notice was issued on the basis of Board's Circular No. 102/4/95-CX. 3, dated 14-5-96 which is noted by the Settlement Commissioner in Re-Oriflame India Ltd. - 2001 (130) E.L.T. 966 (Settlement Commissioner). Finally, he relied upon the decision in the case of Lakme Lever v. CCE, Mumbai 3 - 2001 (127) E.L.T. 790 wherein it was held that if the product is held marketable any amount of treatment to enhance its marketability or impart more value addition to it would not amount to manufacture within the meaning of phrase, "any further treatment". He mentioned that in this case, the assessee was receiving back in its depots cosmetics sold to the general public in normal packing; that these packages were repacked for sending to the Canteen, Stores, Department, the Tribunal held the product to be not liable to the Central Excise duty.
4. We have considered the submissions of both the sides. Note 6 to Chapter 34 reads as under :
"In relation to products of this Chapter, labelling or re-labelling of containers and repacking from bulk packs to retail packs or the addition of any other treatment to render the product marketable to the consumer, shall amount to manufacture."
5. The respondents in the present case, admittedly are only pasting the sticker on the packing of the imported soap to indicate the name of the importer and the MRP which is the requirement under the Standards of Weights and Measures Act. Simply putting a sticker, in our view, will neither amount to labelling or re-labelling, the processes which have been deemed to be a process of manufacture by Note 6. It is not the case of the Revenue that the label has been replaced by a new label or any label has been pasted over the existing label. Accordingly, it cannot be claimed that the process undertaken by the appellants amounts either to labelling or re-labelling. The Central Board of Excise & Customs has taken the same view in respect of imported finished medicines which were sold after pasting sticker on the cartons of the imported item in view of the requirement of the Drugs and Cosmetics Act without altering any information originally contained in the packet. The Board clarified that Note 5 to Chapter 30 may not be attracted in such a situation. Note 5 to Chapter 30 is para meteria to Note 6 to Chapter 34. Accordingly, we do not find any infirmity in the impugned Order and therefore reject the appeal filed by the Revenue.