Customs, Excise and Gold Tribunal - Ahmedabad
Ashwin Steel Industries vs Cce on 8 May, 2007
Equivalent citations: 2007(119)ECC366, 2007ECR366(TRI.-AHMEDABAD), 2007(216)ELT459(TRI-AHMD)
ORDER M.V. Ravindran, Member (J)
1. This appeal is directed against the Order-in-Appeal No. 221/2001, Dt. 30.3.2001.
2. The appellant is unrepresented despite the notice nor there is any request for adjournment. Since the appeal is of 2001, we take up the appeal for disposal, in the absence of appellant.
3. Heard learned DR and perused the records.
4. The issue involved in this case is that appellant being a SSI unit, were availing concessional rate of duty under Notification No. 38/97 dt. 27.6.97, in respect of the products manufactured by them and affixed with logo of "CK/TATA" etc. The contention of the appellant that there products are not branded product in as much as these are manufactured and cleared to the original equipment manufacturer and that the value of this product even if considered, the appellant did not exceed the limit as envisaged in the Notification No. 38/97 dt. 27.6.97. On the other hand, it is the contention of the Revenue that these products are to be considered as branded product and duty to be discharged by appellant since the appellant has not followed the procedure of Chapter X in this case.
5. On perusal of the records, it is seen that the appellant has cleared the product manufactured by him without payment of duty on the ground of that they are is still within the limit of Rs. 30 lakhs as envisaged in Notification No. 30/97, dt. 27.6.97 under impressions that the final products, being further used in original equipment, cannot be considered as branded products.
5. We find that CBEC vide Circular No. 71/71/94-C.E., dt.27.10.94 clarified as under:
7. Coming to the first illustration, castings are manufactured as per the specific requirement of the customers and the brand name which the small scale unit puts on such castings is meant for use of the customer only for further manufacture. Castings having such brand name are not sold in the market as castings as such because it will be of no use to another person. It is felt that when such castings are not "traded" but only sold to a particular manufacturer for his own use, the embossing of the brand name of the customer on the customer on the castings would not amount to using brand name so as to deny the benefit of Notification No. 1/93. Of course, if it is found that such branded castings are traded in the market as such it will amount to use such castings in the course of trade and the benefit of exemption notification will not be available. In other words, so long as the branded castings are being supplied to the customer for further manufacture, and are not otherwise "traded", the benefit of small scale exemption in such cases should not be denied merely on the ground that it contains brand name of another unit. Whether such supply is in the course of trade or not, of course, will be a matter of fact and has to be ascertained from the nature of transaction between the small scale unit and the brand name owner. So long as they are made to order as per the design and specification a particular manufacturer and sold to that manufacturer for his own use, the benefit of Notification No. 1/93 cannot be denied.
6. It may be noted from the above reproduced clarification given by CBEC that if small scale industries cleared the goods which are used by original equipment manufacturer, with the logo of the original equipment manufacturer, the same can not be considered as branded goods. In the current case that the product manufactured and cleared by the appellant contains the logo of the original equipment manufacturer and this product is used by original equipment manufacturer in their machinery/components/equipments. The contention of the appellant that they are 100% selling 100% of their production to the original manufacturer is uncontroverted. The issue in this case is squarely covered by the clarification given by CBEC, and the appellant cannot be visited with the duty and penalty.
7. Accordingly, the impugned order is liable to be set aside and we do so, and hold that appellant is eligible for benefit of SSI. The appeal is allowed with consequential relief, if any.
(Dictated and Pronounced in Court)