2015 (2) TMI 749 - AT - Central Excise

Benefit of SSI Exemption - User of brand name of others / logo of other company - Notification No.1/93-CE, dated 28.02.1993 - Held that - respondent were using the brand name of other person for their chemicals in textile industry, whereas, the brand name owner was producing chemicals for leather industry. The Commissioner (Appeals) following various Tribunal decisions observed that the brand name belonging to other is used on different goods that was produced by the brand name owner, and SSI exemption cannot be denied. - Supreme Court, while dealing with the SSI Exemption Notification No.1/93-CE, as applicable in the present case had observed that the assessee would not be entitled to get the benefit of SSI exemption irrespective of fact that the use is of different goods or same goods - Decision in the case of COMMISSIONER OF C. EX., TRICHY Versus RUKMANI PAKKWELL TRADERS 2004 (2) TMI 69 - SUPREME COURT OF INDIA followed. Hence, the order of the Commissioner (Appeals) cannot be maintained. At this stage, the learned Counsel for the respondent submits that they pleaded before the Commissioner (Appeals) that the demand is barred by limitation. The learned Counsel drew the attention of the Bench to the relevant grounds of appeal on limitation before the Commissioner (Appeals). We find that the Commissioner (Appeals) had decided the matter on merit without considering the limitation aspect. It is noticed that the Adjudicating authority also did not consider the submissions of the respondent as demand is barred by limitation. - Impugned order is set aside - Order of Adjudicating authority restored subject to that the Adjudicating authority would examine the demand of duty on the limitation aspect on the basis of the facts and case law as submitted by the department as well as the party - Decided in favour of Revenue.

Summary

Issues:
1. Interpretation of SSI Exemption Notification No.1/93-CE regarding brand name usage on different goods.
2. Misuse of brand name leading to denial of SSI exemption.
3. Consideration of limitation aspect in demand for duty.

Analysis:
1. The case involved the interpretation of SSI Exemption Notification No.1/93-CE concerning the use of a brand name on different goods. The respondent, engaged in manufacturing textile finishing agents, used a brand name owned by another company producing chemicals for the leather industry. The Commissioner (Appeals) allowed the respondent's appeal, citing Tribunal decisions that the brand name usage on different goods did not warrant denial of the SSI exemption. However, the Tribunal referred to a Supreme Court case where it was held that the exemption could be denied even if the brand name was used on different goods. The Tribunal concluded that the Commissioner's decision could not be maintained based on this legal precedent.

2. The misuse of the brand name by the respondent led to the denial of the SSI exemption. The Central Excise officers found that the respondent used a logo owned by another company on their products, leading to a show-cause notice proposing to deny the SSI exemption and demand duty. The Adjudicating authority confirmed the duty demand and imposed a penalty, which was set aside by the Commissioner (Appeals). However, the Tribunal, considering the misuse of the brand name, decided to restore the Adjudicating authority's order on merit, emphasizing that the brand name usage led to the denial of the SSI exemption.

3. The issue of limitation in the demand for duty was raised by the respondent, claiming that the demand was barred by limitation. The Commissioner (Appeals) did not consider this aspect while deciding on the case. The Tribunal, after setting aside the Commissioner's decision, instructed the Adjudicating authority to examine the demand of duty on the limitation aspect based on submissions from both the department and the respondent. The Tribunal allowed the appeal by the Revenue, remanding the case for further consideration on the limitation aspect, ensuring a proper opportunity of hearing for the respondent before making a decision.