2010 (4) TMI 942 - AT - Central Excise

Issues Involved:
1. Denial of SSI exemption under Notification No. 8/2003.
2. Use of the brand name "RATTAN".
3. Invocation of the extended period of limitation under Section 11A(1) of the Central Excise Act.
4. Refund of the deposit amount and interest thereon.

Detailed Analysis:

1. Denial of SSI exemption under Notification No. 8/2003:
The appellants sought to stay the order where the Commissioner dropped proceedings initiated against the respondents under a show cause notice. The notice required the respondents to justify why the SSI exemption should not be denied and the specified duty recovered along with interest and penalty. The respondents were using the brand name "RATTAN", which was registered to M/s. Rattan Hammers since 1989. However, the Commissioner found that the respondents had registered the brand name "RATTAN" in their name from 1996, thus following the proper procedure and not intentionally availing benefits of another's goodwill. Consequently, the Commissioner dropped the proceedings, allowing the SSI exemption.

2. Use of the brand name "RATTAN":
The respondents used the brand name "RATTAN" since 1996, which was also registered to M/s. Rattan Hammers. The Commissioner noted that the respondents had registered the brand name retrospectively from 1996, making them co-owners and thus not using another's brand name. The learned SDR argued that retrospective registration did not entitle the respondents to SSI exemption, citing the Apex Court's decisions in Meghraj Biscuits Industries Ltd. and Mahaan Dairies, which emphasized strict compliance with exemption notifications. The Tribunal noted that the respondents' case did not fall under the exceptions of Notification No. 8/03-C.E., thus the benefit of exemption was not available.

3. Invocation of the extended period of limitation under Section 11A(1) of the Central Excise Act:
The Commissioner found that the respondents had declared the use of the brand name "RATTAN" in their declaration, which was verified by the jurisdictional officers, hence there was no concealment. Therefore, invoking the extended period of limitation was not tenable. However, the learned SDR contended that the declaration did not disclose the use of another's brand name, thus justifying the invocation of the extended period. The Tribunal noted that the declaration did not disclose the use of a brand name belonging to another person, and the Commissioner's order lacked analysis on this aspect.

4. Refund of the deposit amount and interest thereon:
The respondents deposited Rs. 5 lakhs during the proceedings. The learned Advocate for the respondents argued that withholding the amount would deny them interest. The Tribunal found it premature to decide on the interest issue and stated it would be addressed during the appeal's disposal. The Tribunal stayed the impugned order, finding the Commissioner's findings prima facie not in consonance with the law laid down by the Apex Court, thus favoring the appellant.

Conclusion:
The Tribunal concluded that the appellants made a prima facie case for staying the impugned order, and the balance of convenience lay in favor of the appellant. The application for stay was allowed, and the impugned order was stayed until the appeal's disposal. The application was disposed of accordingly.

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