23 August 2012
If a brand owner manufactured goods from small vendor who are not in preview of excise ( due to basic exemption of 1.5 crore), is there any excise tax liabilities will required to pay- if yes by whom, the vendor or by brand owner.
24 August 2012
From your Query I assume that you Manufactured total salable product of a brand owner and you separately manufacture different product
here 2 cases involves 1 ) The goods you manufacture and 2) manufacturing for Brand owner
in first case as u told you are below 1.5 cr and therefor avail 8/2003 notification that means u r not liable to pay excise duty on your own product until u cross 1.5 cr But in 2) Case Manufacturing of branded product in this case u have to pay excise duty from rupee 1
25 August 2012
Brand owner is not a mfg. , He will order the products from various small manufacturer to produce the goods as per design & requirement under his brand name.Even then also senario will remain same?
26 August 2012
If u are manufacturing Branded Goods then it is your responsibility whether Brand owner is Mfg Or No not please refer following
Brand Owner is not the Manufacturer - Some large units get their goods manufactured from others under their Brand Name, instead of manufacturing it themselves. They usually control quality and may even supply the design. e.g. Bajaj Electricals get many electrical goods manufactured from others; Batas procure some foot-wear from others and supply under their brand name. Some large pharmaceutical companies also get the goods manufactured from small scale units under their brand names. In such cases; Bajaj, Bata or the Pharmaceutical Companies will not be treated as ‘Manufacturer’ even if they exercise quality control, or allow use of their brand name, or provide financial help to the small manufacturers, or even supply the raw material, if their relation with the manufacturer is ‘Principal to Principal’ basis. Supreme Court in Cibatul Ltd. v. UOI - 1978 (22) ELT 302 (SC) - have held that if the goods are produced with Customer’s brand name under his quality control, it does not mean that the Customer is the Manufacturer. Same view was reaffirmed in Jt. Secretary to Government of India v. Food Specialities Ltd. - 1985 (22) ELT 324 (SC).
Brand name owner will not be manufacturer even if he supplies raw material. - Philips India Ltd. v. UOI - 1980 (6) ELT 263 (All HC DB) - quoted and followed in Cheryl Laboratories v. CCE - 1993 (65) ELT 596 (CEGAT
CAclubindia
