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2019 (2) TMI 1776 - AT - Central ExciseSSI exemption - use of brand name of others - free floating brand name or not - demand alongwith interest and penalty - CBEC No. 52/94-CX dated 01.09.94 - HELD THAT - It is seen from the record that the brand names which have used by the appellant is not belonging to them but held by the other persons, the identity of which has not been established by the department. In such circumstances, these brand names are required to be treated as free floating brand names and therefore can been used by any person - This issue has also been clarified by CBEC vide its circular dated 01.09.94. This issue regarding the use of brand name which is not belonging to any person has been examined in various cases by this Tribunal, wherein it is held that brand name which is free floating and not belong to a particular person the benefit of SSI exemption is not deniable - reliance can be placed in the case of AMPLE INDUSTRIES VERSUS COMMISSIONER OF C. EX., RAJKOT 2007 (8) TMI 156 - CESTAT, AHMEDABAD . The SSI benefit cannot be denied to the appellant - appeal allowed - decided in favor of appellant.
Issues:
1. Entitlement to SSI exemption based on the use of brand names not owned by the appellant. Analysis: The case involved an appeal against the rejection of an appeal filed by the appellant, a plywood manufacturer, regarding the denial of SSI exemption under Notification No. 08/2001-CE. The appellant used various brand names on their products, some of which were not owned by them. The department contended that using these brand names made the appellant ineligible for SSI exemption. The appellant, however, argued that the brand names were 'free floating' and not owned by any specific person, citing CBEC Circular No. 52/94-CX. The appellant relied on case laws like M/s Ample Industries Vs. Commissioner of C.Ex. Rajkot and others to support their claim that using such brand names did not disqualify them from SSI exemption. The Revenue argued that the appellant had acknowledged their ineligibility for SSI exemption by paying duty, interest, and penalty and requesting the closure of proceedings. They contended that the appellant should not be entitled to reduced penalty. However, the Tribunal noted that the issue revolved around whether the brand names used by the appellant, not owned by them, could still allow for SSI exemption. The Tribunal examined the definition of 'brand name' and 'trade name' and referred to CBEC circulars and case laws to determine that the use of 'free floating' brand names did not disqualify the appellant from SSI exemption. The Tribunal emphasized that the burden of proving ownership of brand names lay with the Revenue, which had not been established. Citing case laws like Ample Industries and Abhishek Pharma Engineers, the Tribunal concluded that the appellant's use of brand names not owned by any specific person did not warrant the denial of SSI exemption. The Tribunal found in favor of the appellant, setting aside the impugned order and allowing the appeal with consequential benefits as per law. The Tribunal highlighted that despite the appellant's initial agreement and payment, the department could not change its stance after re-opening the case and issuing a show cause notice. The decision was based on legal principles and precedents supporting the appellant's entitlement to SSI exemption despite the use of certain brand names not owned by them.
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