- (1.) The appellant herein was engaged in the manufacture of certain articles from vulcanized rubber as bushes for use in the motor vehicles. Indubitably, the appellant is a Small Scale Industrial unit (hereinafter referred to as 'SSI' for short). The appellant has its own brand name "VIR" and has been manufacturing these products under the said brand name and supplying the same to various customers. In addition, the appellant was also having job orders from some automobile companies like Hindustan Motors, Kinetic Honda, etc.
(2.) Insofar as orders for manufacture of spare parts placed by these automobile companies are concerned, on the said goods, the appellant had been putting the identification mark such as "HM", "PAL", "KH", etc. The goods which were supplied to these automobile companies used to be cleared by the appellant on payment of excise duty. However, in respect of manufacture of its own goods under the brand name "VIR", the appellant claimed SSI benefit in terms of Notification No. 1/93 which provides for exemption from payment of excise duty on fulfillment of certain conditions. It is admitted case that the appellant fulfils all the conditions mentioned in the aforesaid notification except one, in respect of which the dispute has arisen. This condition under the notification stipulates that the aggregate value of clearances in the preceding financial year should be less than Rs.3 crores. There is a lis as to whether the appellant fulfils this condition or not.
(3.) While interpreting this notification, the Department included the value of goods supplied to the automobile companies under the brand name 'HM" "PAL", "KH", etc. and on that basis, came to the conclusion that the total value of goods cleared by the assessee in the previous financial year was much more than Rs.3 crores. The contention of the appellant, on the other hand, was that since the appellant had been using the brand name of the automobile industries while carrying out their job work and even clearing those goods on payment of excise duty, the turnover in respect of these goods should not be included while arriving at the figure of Rs.3 crores. To put it otherwise, submission was that it is only in respect of "VIR" brand goods, which is the proprietory brand of the appellant, the value of clearances in the preceding year should be taken into consideration and if, that is done, the total value of clearances was much less than Rs. 3 cores. This contention of the appellant, however, has not been accepted by the authorities below including Customs, Excise & Gold (Control) Appellate Tribunal (hereinafter referred to as 'CEGAT'). Rejecting the aforesaid contention of the assessee and accepting the plea of the Department, the CEGAT has gone by the definition of "brand name" or "trade name" contained in para 4 of the aforesaid Notification and reads as under: - "4. The exemption contained in this notification shall not apply to the specified goods bearing a brand name or trade name, whether registered or not, of another person, except in the following cases: - (a) where such specified goods, being in the nature of components or parts of any machinery or equipment or appliances, are cleared for use as original equipment in the manufacture of the said machinery or equipment or appliances by following the procedure laid down in Chapter X of the Central Excise Rules, 1944. Provided that manufacturers, whose aggregate value of clearances for home consumption of such specified goods for use as original equipment does not exceed rupees fifty lakhs in a financial year as calculated in the manner specified in the said Table, may submit a declaration regarding such use instead of following the procedure laid down in Chapter X of the said rules; (b) where the specified goods bear a brand name or trade name of - (i) the Khadi and Village Industries Commission; or (ii) a State Khadi and Village Industry Board; or (iii) the National Small Industries Corporation; or (iv) a State Small Industries Development Corporation; or (v) A State Small Industries Corporation. 5. This notification shall come into force on the 1st day of April, 1999. Explanation.- For the purposes of this notification,- (A) "brand name" or "trade name" shall mean a brand name or trade name, whether registered or not, that is to say a name or a mark, such as symbol, monogram, label, signature or invented word or writing which is used in relation to such specified goods for the purpose of indicating, or so as to indicate a connection in the course of trade between such specified goods and some person using such name or mark with or without any indication of the identity of that person;";