2016 (6) TMI 512 - AT - Central Excise

SSI Exemption - use of Brand/Trade mark or others - Exemption available to small scale units under exemption notification no. 08/2003 dated 1.3.2003 - denial of exemption as assessee used somebody s else brand name in the excisable goods cleared - CIT(A) allowed the claim - Held that - There is no dispute regarding the ownership of the trade mark Superfix which was assigned in the name of the Appellants by a deed of assignment dated 18.11.05 by the brand name owner M/s.Indofil Chemicals Co. Moreover, as rightly pointed out by the Appellants, registration of the trade mark/brand name with the trade mark authorities is not relevant for the SSI exemption as even in respect of an unregistered trade mark owned by any person exemption can be availed. The Adjudicating Authority is therefore in error in not properly considering the case laws cited by the Appellants to the effect that the ownership of the trade mark would be with them from the date of the deed of assignment. The Hon ble Supreme Court in the case of Primella Sanitary Products (2005 (4) TMI 70 - SUPREME COURT OF INDIA ) held that as long as assignment stands the assessee using the brand name is eligible for the benefit of SSI exemption notification. - Decided against revenue

Summary

Issues:
- Appeal against denial of exemption under central excise duty for products bearing a specific brand name.
- Dispute over ownership of the brand name "SUPERFIX" used by the respondent.
- Interpretation of relevant case laws regarding brand name ownership and eligibility for exemption.

Analysis:
1. The appeal was filed by the Revenue against the order of the Commissioner (Appeals) denying exemption to the respondent for products under the brand name "SUPERFIX." The Revenue contended that the brand name did not belong to the respondent before registration, making them ineligible for exemption.
2. The Revenue argued that registration of the brand name after usage does not validate the claim for exemption. They cited case laws to support their position, emphasizing the importance of brand name ownership at the time of product clearance.
3. In contrast, the respondent claimed that the brand name was legally assigned to them and used with the rightful owner's consent. They highlighted the absence of evidence proving ownership by any other party and the subsequent registration of the brand name as supporting their case.
4. The Tribunal examined the ownership of the brand name "SUPERFIX" in detail. The Commissioner (Appeals) concluded that the brand name was assigned to the respondent by a deed, establishing their right to claim the exemption. The Tribunal emphasized that registration with trademark authorities is not a prerequisite for availing the exemption.
5. The Tribunal differentiated between the issues of brand name registration and actual usage, focusing on whether the respondent used another party's brand name. The factual findings confirmed that there was no evidence of unauthorized brand name usage by the respondent.
6. Citing the Supreme Court's decision in Primella Sanitary Products, the Tribunal affirmed that as long as the brand name assignment is valid, the assessee is eligible for the SSI exemption. Based on this analysis, the Tribunal dismissed the appeal, finding no merit in the Revenue's arguments.
7. The judgment highlights the importance of establishing ownership rights through legal assignments and deeds for claiming exemptions under central excise duty. It clarifies that brand name registration, while relevant, is not determinative of eligibility if ownership can be substantiated through valid documentation and usage rights.

Conclusion:
The Tribunal's decision upheld the respondent's right to claim exemption for products under the brand name "SUPERFIX" based on the legal assignment of the brand name and the absence of evidence indicating unauthorized usage. The judgment emphasizes the significance of ownership rights and valid assignments in determining eligibility for exemptions under central excise duty laws.