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2017 (5) TMI 1442 - AT - Central ExciseSSI exemption - use of brand name of others - the appellants had cleared the goods with the brand name TRANSPADE which belonged to a proprietary concern viz. M/s. Transpede of which Shri S.B. Ghorpade was the proprietor. He was also Managing Director of the appellant/assessee company - Held that - In the case of CCE Vs. Minimax Industries 2011 (1) TMI 782 - DELHI HIGH COURT , the Hon ble Delhi High Court had occasion to examine a similar case of denial of SSI benefit in respect of goods cleared with the brand name MINIMAX, In the said case, this brand name was being applied to goods manufactured by M/s.Minimax Industries. The allegation was that this brand name belonged to another unit, which was the sole proprietorship concern of Mr. Mohd. Yamin. It was held in the case that it can be said that at the most, the name Minimax belongs to both the entities namely, the partnership firm as well as MEI - exemption was allowed - appeal allowed - decided in favor of appellant.
Issues:
Claim of SSI exemption based on the use of brand name "TRANSPADE" by the appellant, Burden of proof on the department regarding brand ownership, Allegation of using brand name belonging to another person, Plea of limitation for demand, Interpretation of relevant notifications disallowing benefit for goods with another brand name. Analysis: The appellant, engaged in manufacturing cranes and hoists, availed SSI exemption during 1998-99 and 1999-2000. The Department alleged that goods were cleared with the brand name "TRANSPADE," owned by a proprietary concern, M/s. Transpede, managed by the appellant's Managing Director. A show-cause notice proposed denial of SSI exemption, leading to a confirmed demand of differential duty and a penalty. The Commissioner(Appeals) upheld the decision, prompting the present appeal. The appellant argued that the brand name belonged to their Managing Director, justifying its use. They contended that being a registered private limited company, the use of the name "Transpade" was legitimate. The burden of proof was placed on the department to establish brand ownership, which they failed to do with corroborative evidence. The appellant also claimed the demand was time-barred due to regular declarations filed with the Department, not constituting suppression. The Revenue opposed the appellant's claims, citing relevant notifications disallowing benefits for goods with another brand name. They relied on case laws to support their stance, emphasizing that the brand name "TRANSPADE" did not belong to the appellant, justifying the denial of SSI exemption. The Revenue also contested the plea of limitation, citing precedents to support their argument. The key issue revolved around the interpretation of notifications disallowing benefits for goods affixed with a brand name belonging to another person. The Tribunal analyzed previous cases where eligibility for SSI benefit concerning goods with specific brand names was decided in favor of the assesses. Notably, in a similar case, the Delhi High Court ruled in favor of the appellant, emphasizing that the brand name could belong to multiple entities without exclusive rights claimed. Another recent case dismissed a Departmental appeal, affirming the appellant's right to use the brand name "Naughty" owned by one of the Directors. By following these precedents, the Tribunal found no merit in the Revenue's arguments, setting aside the impugned order and allowing the appeal with consequential benefits to the appellant.
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