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2017 (10) TMI 71 - AT - Central ExciseSSI exemption - use of Brand Name of others - the assessee is partnership firm which was established by two brothers and they have surrendered their right in favour of their sons - Held that - trade mark was used by the sons who replaced their fathers as partner - they are entitled to use the trade mark specially when this trade mark is not belonging to any other person or nobody or claimed by any other person. Reliance placed in the case of Kali Aerated Water Work, Salem Versus Commnr. of Central Excise, Madurai 2015 (6) TMI 226 - SUPREME COURT , where it was held that Trade name Kalimark Aerated Water Works and trade mark mentioned in the said agreement would remain vested in all the parties including the appellant and the appellant was also allowed to use the same. Appeal allowed - decided in favor of appellant.
Issues:
1. Demand raised against M/s. Shivam Plywood Company for non-payment of duty on goods using a brand name of others. 2. Applicability of notification No.8/2003 (SSI exemption) to the case. 3. Surrender of rights in favor of sons for partnership firm. 4. Interpretation of trade name and trademark ownership. 5. Entitlement to use the trade name by sons replacing fathers as partners. Analysis: 1. The appeals were filed against the order-in-appeal confirming a demand of &8377;4,76,919/- and a penalty of &8377;50,000/- on Shri Nitin Gupta, partner of M/s. Shivam Plywood Company for not paying duty on goods using a brand name of others. The main issue was the duty liability concerning the use of the brand name 'Door King' by the appellant. 2. M/s. Shivam Plywood Company was availing the benefit of notification No.8/2003 (SSI exemption) for manufacturing flush doors under the brand name 'Door King.' The demand was primarily based on the allegation that they were using another's brand name without paying duty on the goods. The case revolved around the interpretation and applicability of the SSI exemption notification to the situation. 3. The appellant partnership firm was established by two brothers who later surrendered their rights in favor of their sons. The argument presented was that the sons, who replaced their fathers as partners, were entitled to use the trade name, especially when it was not claimed by any other person. The surrender of rights and succession in the partnership firm were crucial aspects under consideration. 4. The Tribunal referred to the Supreme Court judgment in the case of Kali Aerated Water Works, emphasizing the importance of ownership rights over trade names and trademarks. The discussion highlighted the legal ownership of the brand names within a specific marketing area, reinforcing the appellant's exclusive right to use the brand name 'Kalimark.' The interpretation of trade names and trademarks played a significant role in determining the appellant's entitlement to use the specific brand name. 5. Considering the succession of proprietary rights and the replacement of fathers by sons as partners, the Tribunal applied the Supreme Court's ruling to allow the sons to use the trade name. The judgment in Civil Appeal No. 9157 of 2003 was cited to support the appellant's case, leading to the setting aside of the impugned order and allowing the appeals. The entitlement of sons to use the trade name in the absence of any conflicting claims was a crucial aspect influencing the Tribunal's decision. This detailed analysis of the judgment showcases the legal intricacies involved in addressing the issues raised in the appeals before the Appellate Tribunal CESTAT NEW DELHI.
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