2017 (10) TMI 744 - AT - Central Excise

SSI Exemption - use of Brand name - case of Revenue is that the appellants are removing their products using the brand name LAKSHMI owned by another unit - Held that - the same Commissioner(Appeals) in the appellant s own case for the subsequent period i.e. September 2005 to July 2006 involving an identical issue has decided in favor of the appellant by holding that the appellants have not used the brand name of Sri Lakshmi Industries, Coimbatore and both are different and the appellants are entitled for SSI exemption - the same Commissioner in respect of the another unit using the same name has taken a view that there is a difference in the nature of logo and the word Lakshmi which was used by the assessee and held by order dt. 24/04/2008 that the assessee is entitled for SSI exemption as they are not used brand name or trade name of another - appeal allowed - decided in favor of appellant.

Summary

Issues:
Appeal against order dismissing appeals, eligibility for SSI exemption under Notification No.8/2003-CE, use of brand name LAKSHMI, infringement threats by another party, judicial precedents supporting appellant's case, subsequent favorable decisions by same Commissioner, Department's acceptance of subsequent decision, sustainability of impugned order.

Analysis:

1. The appellants filed appeals against the order passed by the Commissioner(Appeals) dismissing their appeals. The issue revolved around the eligibility of the appellants for Small Scale Industry (SSI) exemption under Notification No.8/2003-CE. The appellant-firm, a manufacturer of wet grinders, was accused of using the brand name LAKSHMI owned by another unit, leading to searches, show-cause notice, and demand of duty. The original authority confirmed the demand, which was upheld by the Commissioner(Appeals), prompting the present appeals.

2. The appellant's counsel argued that the impugned order was contrary to evidence and binding judicial precedent. They contended that the appellants were not using the brand name of another person and were eligible for SSI exemption. Reference was made to a Supreme Court decision regarding simultaneous use of logos/trademarks by different entities. The counsel also highlighted that the appellants had a bona fide belief in their entitlement to the exemption based on favorable judicial decisions during the disputed period.

3. The counsel further presented that the appellants had faced threats from the other party regarding trademark infringement but had obtained a temporary injunction from the High Court, which was later made permanent. Notably, the same Commissioner had ruled in favor of another unit using the same name in a subsequent period, indicating inconsistency in the impugned order. The counsel relied on various decisions to support the appellant's case.

4. On the contrary, the Department argued that the appellants were using the brand name of a popular party, thereby disqualifying them from SSI exemption. They cited several decisions to support their stance.

5. The Tribunal examined the submissions and reviewed the materials on record. It noted that the same Commissioner had ruled in favor of the appellant for a subsequent period involving a similar issue. The Commissioner had found distinctions in the labels and logos used by the appellants, supporting their claim for SSI exemption. The Tribunal also referenced a Supreme Court decision regarding finality of decisions accepted by the Department, leading to the setting aside of the impugned order. The Tribunal concluded that the impugned order was not sustainable in law, allowing the appeals of the appellants with consequential reliefs.