ORDER
V.K. Agrawal, Member (T)
1. The issue involved in this appeal filed by M/s. Mistry Paints (P) Ltd. is whether the benefit of Notification No. 175/86 was available to the excisable goods affixed with brand name of another manufacturer before issue of Notification No. 223/87, dated 22-9-1987 amending Notification No. 175/86.
2. Shri Rajeev Batra, learned Advocate submitted that besides manufacturing their own goods, they were also manufacturing branded paints and varnishes for Asian Paints India Ltd., and M/s. Goodlass Nerolac and were availing benefit of exemption under Notification No. 175/86, dated 1-3-1986. Notification No. 175/86 was amended by Notification No. 223/87, dated 22-9-1987 making the benefit of notification not available to the goods affixed with the brand name of another person. Two show cause notices were issued to them for demanding the duty on clearances of branded goods for the period from March, 1987 to 30th September, 1987. The Asstt. Collector under order dated 31-3-1992 dropped the demand of the duty against them holding that the raw material supplier cannot be held manufacturer of the goods. However, on appeal filed by the Department, the Collector (Appeals) set aside the order of the Assistant Collector holding that it was clear from para 7 of Notification No. 175/86 that once a manufacturer had affixed brand name of another manufacturer, the benefit of the said notification would not be available; that as the appellants were affixing the brand name of their customers, they were not eligible to avail exemption. The learned Advocate contended that para 7 was not part of the Notification during the relevant period i.e. March, 1987 to September, 1987; that the position making ‘branded’ goods ineligible for the exemption was introduced by Notification No. 223/87, dated 22-9-1987; that the Appellate Tribunal has considered this issue under identical circumstances to other job workers of Asian Paints in the case of C.C.E. v. Muralo Chemicals vide Final Order Nos. 784-786/91-C, dated 29-10-1991 and in the case of Crystal Paints v. C.C.E., Final Order Nos. 95 & 96/91-C, dated 11-1-1991 1991 (54) E.L.T. 249 (T). He also mentioned that the appellants are willing to pay the differential duty in respect of the goods affixed with the brand name of their customers during the period from 22-9-1987 to 30-9-1987.
3. Countering the arguments, learned SDR Shri Satnam Singh submitted that the goods were manufactured by the appellants on job work basis by affixing the brand name of their customers and as such the exemption from payment of duty under Notification No. 175/86 was rightly denied.
4. We have considered the submissions of both the sides. Notification No. 175/86 dated 1-3-1986 did not contain initially any condition to the effect that the benefit of the notification would not apply to the goods affixed with a brand name of another person who is not eligible for the grant of exemption under the Notification. Such a condition was introduced in Notification by inserting paragraph 7 by Notification No. 223/87-C.E., dated 22-9-1987. There is nothing in the amending notification to suggest that this paragraph would be applicable retrospectively. Accordingly, the appellants have rightly contended that this paragraph would not make the goods affixed with the brand name cleared before 22-9-1987 ineligible to the exemption. We also observe that the Collector (Appeals) has mentioned in his findings in the impugned order that the other points i.e. the points regarding sale being on principal to principal basis, the sale being guided only by commercial consideration, etc., are relevant only for determination of assessable value and such points are not relevant for determing the applicability of para 7 of the notification in the case. We accordingly hold that the appellants were entitled to the exemption from payment of duty under Notification No. 175/86 in respect of goods affixed with brand names of their customers and removed from their factory before 22-9-1987 i.e. the date on which Notification No. 175/86 was amended by Notification No. 223/87. The appellant’s are, however, liable to pay the duty on such goods removed on or after 22-9-1987. This liability to duty has been accepted by the learned Advocate appearing on behalf of the appellants. The appeal is thus disposed of in these terms.