2016 (11) TMI 769 - AT - Central Excise

SSI exemption - use of brand name of others - Whether the identification mark put on the goods by the assessee shall be treated as trade name or brand name of others or not? - Held that - This is a fact base case and buyers of the goods have filed affidavits stating that the goods purchased from the respondent having identification mark but these identifications marks are not their trade name or brand name. The identification marks are not the trade name or brand name of the buyers, in that instant case, we hold that the respondent is not manufacturing the goods having the brand name of others. Therefore, the respondent is entitled to avail the benefit of SSI exemption notification. Appeal dismissed - decided against Revenue.

Summary

Issues:
Whether the identification mark put on the goods by the assessee shall be treated as trade name or brand name of others or not.

Analysis:

The case involves a dispute regarding the eligibility of the appellant for Small Scale Industry (SSI) exemption under the Central Excise Tariff Act, 1985. The appellant, a manufacturer of bolts, had put identification marks like VF, RE, TVS, DECENT, H.F., J.P.F., and POOJA FORGE on the goods supplied to customers. The Revenue contended that these marks constituted trade or brand names of other persons, making the goods ineligible for SSI exemption. However, the Joint Commissioner and Commissioner (Appeals) held that these marks were for identification purposes, not brand names. The main issue was whether these identification marks amounted to trade or brand names of others, affecting the eligibility for SSI exemption.

The appellant argued that the identification marks were necessary for traceability and compliance with quality standards, citing ISO specifications. Affidavits from buyers supported that these marks were not trade or brand names. Legal precedents, including the Unison Electronics case, were cited to support the contention that such marks do not constitute brand names. The appellant emphasized that the marks did not indicate a connection with the customer, as required for them to be considered brand names. Various tribunal and Supreme Court decisions were relied upon to establish that mere identification marks do not disqualify a unit from SSI benefits.

After considering the arguments and precedents, the Tribunal found that the identification marks used by the appellant were not trade or brand names of the buyers. The Tribunal distinguished the case from previous judgments where marks were considered brand names, emphasizing that in this instance, the marks were solely for identification purposes. Citing cases like Pethe Brakes Motors Ltd., Malabar Oxygen Pvt. Ltd., and Deebha Foundry, the Tribunal upheld that affixing identification marks did not amount to using brand names of others. Consequently, the Tribunal upheld the impugned order, ruling in favor of the appellant and dismissing the Revenue's appeal.

In conclusion, the Tribunal's decision clarified that the identification marks placed on the goods by the appellant were not considered trade or brand names of others, affirming the appellant's entitlement to SSI exemption benefits. The judgment highlighted the distinction between mere identification marks and brand names, emphasizing that compliance with quality standards and traceability requirements does not equate to using brand names of others, as supported by legal precedents and relevant case law.