Customs, Excise and Gold Tribunal - Mumbai
Nilgiri Herbals Pvt. Ltd. vs Commr. Of C. Ex. on 19 June, 2002
Equivalent citations: 2003(152)ELT436(TRI-MUMBAI)
ORDER Jyoti Balasundaram, Member (J)
1. The brief facts of the cases are that in May 1994 M/s. Nilgiri Herbals Pvt. Ltd., appellants herein, who are engaged in the activity of marketing consumer products, entered into an agreement with M/s. Fernhill Laboratories & Industrial Establishment, owners of brand name 'COLIN' permitting the appellants to use the said brand name for marketing glass and household cleaners. After entering into an agreement they placed orders on M/s. Royal Chemical Industries, Vapi for manufacture of household glass cleaners which were supplied in three different unit packings. The bottles so received were stored in the appellant's godown where the manufacturers' labels affixed on such bottles were removed and new labels with the brand name 'COLIN' were affixed. The bottles so re-labelled were put in cartons bearing labels describing the goods as 'COLIN' glass and household cleaners and then sold to various customers. On June 6, 1995 a Show Cause Notice was issued to the appellants demanding duty of Rs. 59,555.15 on these goods sold during the period 6-8-1994 to 1-9-1994 and also proposing confiscation of the seized goods on the basis that the process of affixing the brand name 'COLIN' amounted to manufacture as per Note 6 to Chapter 34 of the Schedule to CETA 1985.
2. The notice also proposed imposition of penalty on M/s. Nilgiri Herbals Pvt. Ltd., M/s. Fernhill Laboratories & Industrial Establishment and M/s. Royal Chemical Industries as well as on Director of the Nilgiri Herbals Pvt. Ltd.
3. The notice was adjudicated by the Commissioner of Central Excise who confirmed the duty demand proposed in the Show Cause Notice and imposed a penalty of Rs. 1 Lakh on M/s. Nilgiri Herbals Pvt. Ltd. and penalty of Rs. 50/000/- on M/s. Fernhill Laboratories & Industrial Establishment, and Rs. 25,000/- on M/s. Royal Chemicals Industries and Rs. 10,000/-on directors of M/s. Nilgiri Herbals Pvt. Ltd. and he also ordered confiscation of the seized goods with option to redeem the same on payment of fine of Rs. 30,000/-. Hence these appeals.
4. M/s. Nilgiri Herbals Pvt. Ltd, have asked for decision on the lines of Tribunal Order No. CI/4093-4094/WZB/2000, dated 17-11-2000 [2001 (132) E.L.T. 781 (Tribunal)] in their own case wherein, the Tribunal has set aside the duty demand and penalty. Counsel for M/s. Fernhill Laboratories & Industrial Establishment has informed the Registry of the Tribunal that he has no longer appearing in the appeal. However since the issues in dispute stand settled by the Tribunal Order cited supra, in favour of M/s. Nilgiri Herbals Pvt. Ltd., we proceed to decide these appeals themselves.
5. We find that in the impugned order the Commissioner has held that the process of labelling/re-labelling amounts to adoption of the treatment so as to render the product marketable to the consumers in view of Note 6 to Chapter 34 of the Schedule to the Tariff at the relevant time. Note reads as under:
"In relation to products of sub-heading No. 3402.90, packing or re-packing into smaller containers, including packing or re-packing bulk packs into retail packs or adoption of any other treatment to render the product marketable to the consumer shall amount to "manufacture".
6. In the case of the same appellants, Tribunal has held that the activity carried out by M/s. Nilgiri Herbals Pvt. Ltd. is not covered by the generic expression. "Any other treatment to render the product marketable". Therefore the Tribunal has held that prior to the amendment by which Note 6 provided that the labelling or re-labelling of containers will amount to manufacture (this amendment was in 1997), the process of labelling or relabelling could not be deemed to amount to manufacture.
7. Following the ratio of the above decision which is directly applicable to the facts of the present cases. We set aside the impugned order and allow the appeals.
8. The misc. application for early hearing of the appeals is dismissed as infructuous.