Use of those words on packing which depicts connection with brand name amounts to branding: AAAR

Use of those words on packing which depicts connection with brand name amounts to branding: AAAR

 Facts: M/s Aditya Birla Retail Limited is, inter alia, engaged in the processing and/or trading of a wide range of cereals, pulses and flour. This appeal has been filed against the Advance Ruling No. GST-ARA-13/2017/B dated March 23, 2018 wherein the Hon’ble AAR, Maharashtra. In terms of GST Rate Notification No. 1/2017 -Central Tax (Rate) dated June 28, 2017, supply of subject goods, when put up in unit containers and inter alia bearing a ‘registered brand name’attract GST at the rate of 5%.

Issues Involved:

(I) Whether mention of name of the Appellant on the goods, as required by FSSAI regulations and Legal Metrology Rules, amounts to brand name or not.

(II) Whether use of general words like ‘Choice’, ‘Value’ or ‘Superior’ on the goods to be sold in More Stores would render the said goods as branded or not.

The Hon’ble AAR, Maharashtra answered the first question in negative and left second question unanswered on the premise that ‘the question cannot be raised in isolation’ .

Held: The Hon’ble AAAR, Maharashtra vide Order No. MAH/AAAR/SS-RJ/05/2018-19 dated August 7, 2018 held that merely by removing their registered brand name logos vis. ‘MORE’ and ‘Aditya Birla Retail’ from the packing of some of their product and keeping the surrounding environment intact to take advantage of the said brands not render such goods unbranded and the benefits of exemption notification from GST would not be available to such goods. Also, the use of words like ‘CHOICE’, ‘VALUE’ or ‘SUPERIOR’ on the proposed packing, which are already in use with the brand ‘More’ on the present packing, would amount to branding of goods as the goods can be identified with the brand ‘More’ by the use of these words.

Citation: [2018] 96 taxmann.com 290 (AAAR-MAHARASHTRA)