2016 (8) TMI 33 - AT - Central Excise

SSI exemption - use of brand name - Held that - though the trade mark BONNE was registered in favour of the appellant-assessee with effect from 27.4.2004, they were clearly entitled to use the brand name in their territories assigned to them from 1990 onwards as has been confirmed by the Hon ble Delhi High Court by way of judgment dated 18.12.91. As such, there is no valid reason to deny the benefit of SSI notification benefit during the period of dispute on account of use of the brand name belonging to some other person. Our conclusion is further firmed up in the light of the fact that the other branch of the family has already been allowed the benefit of SSI exemption notification while using the same brand in the respective territories assigned to them. SSI exemption allowed - Decided against the revenue.

Summary

Issues:
Dispute over the use of the brand name "BONNE" and eligibility for small scale industries (SSI) exemption for different periods.

Analysis:
The judgment pertains to three appeals consolidated due to a single order by the Commissioner (Appeals) regarding the use of the brand name "BONNE" and the entitlement to SSI benefits. The original dispute arose from clearances made by the appellant-assessee under the brand name "BONNE" for products like baby feeders, sippers, and nipples. The Revenue contended that the appellant was not the owner of the brand name and thus not eligible for SSI benefits under various exemption notifications. The original authority initially dropped all demands, but the Commissioner (Appeals) allowed SSI benefits only for clearances made after 27.4.2004, denying it for earlier clearances. The appellant sought restoration of the original order, while the Revenue argued for denying SSI benefits for the entire period.

During the proceedings, the appellant's advocate traced the ownership of the brand name "BONNE" back to a partnership firm in 1963, with subsequent legal assignments leading to the appellant's ownership in 1990. The appellant's application for trademark registration in 1990 was delayed due to administrative issues, but the brand name was eventually registered in their favor from 27.4.2004. The Revenue reiterated the findings of the lower authorities.

The Tribunal examined the trade history of the brand name "BONNE," highlighting its ownership transitions through partnerships and family settlements. It was established that the appellant was entitled to use the brand name in their assigned territories from 1990, as confirmed by a previous Delhi High Court judgment. The Tribunal noted a similar dispute involving another branch of the family using the same brand name in different territories, which was resolved in their favor. Considering these factors, the Tribunal concluded that the appellant was rightfully entitled to the SSI benefits during the disputed period and rejected the Revenue's appeals while allowing the appellant's appeal.

In conclusion, the Tribunal upheld the appellant's right to use the brand name "BONNE" and receive SSI benefits from 1990 onwards, as per the legal history and previous court decisions. The judgment was pronounced on 28/6/16, settling the dispute over the brand name ownership and SSI exemption eligibility.