2001 (8) TMI 771 - AT - Central Excise

Summary

Issues Involved:
1. Classification and dutiability of processed nuts.
2. Validity of the assignment of the brand name 'COCO'.
3. Imposition of penalties on the appellants.

Issue-wise Detailed Analysis:

1. Classification and Dutiability of Processed Nuts:
The core issue was whether roasted, salted, and packed peanuts and dry fruits (almonds, cashewnuts, pistachios) sold under the brand name 'COCO' should be classified under Chapter 8 or sub-heading No. 2001.10 of the Central Excise Tariff. The appellants argued that these nuts should be classified under Heading No. 08.01, asserting that roasting does not constitute manufacturing a new product and that the nuts remain the same before and after roasting. However, the Commissioner of Central Excise (Appeals) held that the processes of roasting, salting, and packing gave the nuts a distinct name, character, identity, and usage, making them classifiable under sub-heading No. 2001.10. The Tribunal supported this view, noting that the processes undertaken on the nuts were materially different from those mentioned in Note 1 of Chapter 20, and thus the nuts were correctly classified under Chapter 20.

2. Validity of the Assignment of the Brand Name 'COCO':
The appellants claimed that the brand name 'COCO' was transferred to them by M/s. India International via a deed of assignment dated 18-2-1997. However, the adjudicating authority found that the brand name continued to be used by M/s. India International, and the assignment deed was not valid as it lacked attestation by two witnesses as required under the Transfer of Property Act, 1882. The appellate authority upheld this view, noting that the appellants failed to provide relevant documents to show the brand name's transfer and that M/s. India International continued using the brand name. Consequently, the Tribunal concluded that the brand name 'COCO' belonged to M/s. India International, and the benefit of small-scale exemption was rightly denied to the appellants.

3. Imposition of Penalties on the Appellants:
The adjudicating authority imposed a redemption fine of Rs. 1 lakh and a penalty of Rs. 30,000/- each on the three appellants. The Tribunal agreed with the adjudicating and appellate authorities, noting that the penalties were in consonance with the offences committed. The role of Shri Pradeep Khanna, Director, was specifically discussed, and his involvement justified the penalty under Rule 209A. The Tribunal found no merit in the appellants' arguments against the penalties, citing precedents where penalties were upheld in similar circumstances.

Conclusion:
The Tribunal rejected all three appeals, affirming the classification of the processed nuts under Chapter 20, the invalidity of the brand name assignment, and the imposition of penalties on the appellants.