2014 (4) TMI 988 - HC - Central Excise

Denial of benefit of SSI Exemption - extended period of limitation - brand name - Held that- impugned order dated 9 April 2014 of the Tribunal has not considered the appellant s contention that show cause notices covering the period July 1997 to August 2002 are barred by limitation or that there was no justification in the present facts to impose any penalty upon the appellant. The impugned order dated 9 April 2014 is vitiated to the extent it does not consider and deal with the above submissions of the appellant. On merits also the impugned order dated 9 April 2013 of the Tribunal does not deal with/consider the submissions of the appellant based on letters dated 16 September 2002 and 26 March 2004 received from foreign collaborator stating that the brand name Seal Jet is not their band name. This evidence of the appellant was also not considered in the impugned order dated 9 April 2014 of the Tribunal. The Tribunal is required as a final fact finding authority to determine on the basis of evidence before it whether the brand name Seal jet used by appellant does belong to a foreign company as alleged by the revenue. There is no finding on the above issue. The impugned order has proceeded on the basis that Seal jet is a brand name belonging to a foreign company and dealt with a legal issue that the registration of a brand name would only taken effect for the purpose of excise duty from the date of the registration of the Mark and would not relate back to the date of application for registration as otherwise available under the Trade Mark Act. However, before deciding the aforesaid legal position it was required of the Tribunal to first determine whether or not brand name Seal Jet was belonging of a foreign company. - Matter remanded back - Decided in favour of assessee.

Summary

Issues:
Challenges to common order under Section 35G of the Central Excise Act, 1944; Allegation of non-consideration of evidence by the Tribunal; Appellant's business of manufacturing hydraulic seals, pneumatic seals, and "O" rings; Disputed period of SSI unit registration and benefit availed; Query regarding use of foreign collaborator's brand name; Issuance of show cause notices; Grievance against non-speaking order and lack of consideration of evidence by the Tribunal; Contention on limitation, penalty, and brand name ownership; Remand for fresh order consideration.

Analysis:

1. The judgment involves seven appeals challenging a common order under Section 35G of the Central Excise Act, 1944. The basic grievance raised is that the Tribunal passed the impugned order without considering the evidence supporting the appellant's case, despite the same being pointed out to the Tribunal.

2. The appellant is engaged in the manufacturing of Hydraulic seals, Pneumatic seals, and "O" rings of rubbers and plastics under Chapter 84 of the First Schedule to the Central Excise Tariff Act, 1985. During the period of July 1997 to November 2004, the appellant was registered as an SSI unit and availed the benefit of SSI excise notification for seals manufactured and cleared under the brand name "SEAL JET."

3. The Central Excise Department raised a query in 1996 regarding the use of the foreign collaborator's brand name, "Merkel Economos." The appellant responded, denying the use of the foreign brand name. Subsequently, show cause notices were issued covering the period from July 1997 to November 2004, seeking to deny the SSI Notification benefit on the grounds of using a foreign company's brand name.

4. The appellant challenged the orders of the adjudicating authorities in appeal to the Tribunal, which dismissed the appeals through a non-speaking order. The appellant contended that the impugned order did not address the issue of limitation, penalty, or consider crucial evidence in the form of classificatory letters from the foreign collaborator stating that the brand name "Seal Jet" did not belong to them.

5. Upon review, the High Court found that the impugned order of the Tribunal failed to address the appellant's contentions on limitation, penalty, and brand name ownership. The Tribunal did not consider the evidence provided by the appellant regarding the brand name ownership issue. The High Court set aside the impugned order and remanded the case to the Tribunal for a fresh order considering all relevant issues, including limitation, penalty, and brand name ownership.

6. Ultimately, all seven appeals were disposed of with no order as to costs, leaving all contentions open for further consideration by the Tribunal in light of the High Court's directions.

This detailed analysis of the judgment provides a comprehensive understanding of the issues involved and the High Court's decision regarding the challenges raised by the appellant.