2009 (2) TMI 196 - AT - Central Excise

SSI Exemption - Brand name - appellant was using a nameplate/metal plate indicating Leo - appellant contended that said name Leo does not belong to the other company and was merely reflective of the name of the company. The same was in the nature of a household name or a company s name and cannot be equivated with the brand name - held that - The Revenue has not produced any evidence to establish that the name Leo belonged to M/s. Leo Road Equipments Pvt. Ltd. Neither is there any claim by M/s. Leo Road Equipments P. Ltd. that the brand name belonged to them. - In such a situation the denial of benefit to them is not justified. - In terms of para 4(c) read with explanation H of Notification ibid factories located in rural area are carved out of the mischief of para 4 of the Notification. As such even if the use of nameplate with Leo is considered to be use of brand name belonging to another person the benefit cannot be denied to them in terms of the explanation.

Summary

Issues involved:
Demand of duty based on the use of a brand name, Small Scale Industries Exemption notification, ownership of the brand name "Leo," denial of benefit of SSI Notification, burden of proof on Revenue, interpretation of Notification No. 8/2000-CE, benefit of exemption for factories in rural areas.

Analysis:

1. Use of Brand Name "Leo":
The appellant, engaged in manufacturing road construction equipment, was accused of using the brand name "Leo," which allegedly belonged to another company, making them ineligible for the Small Scale Industries Exemption notification. However, the appellant argued that "Leo" was a common brand name used by both them and the other company, with distinctions in logo design. The Revenue failed to provide evidence supporting their claim that "Leo" exclusively belonged to the other company, leading to the conclusion that the denial of benefits was unjustified.

2. Interpretation of Notification No. 8/2000-CE:
The Tribunal examined Condition No. 4 of Notification No. 8/2000-CE, which restricts exemption for goods bearing a brand name of another person. It was highlighted that the burden of proof lies with the Revenue to establish ownership of the brand name by another entity. The Tribunal referenced previous cases where the benefit of notification was granted when the alleged owner disowned the brand name or failed to prove ownership. In the absence of concrete evidence linking the brand name to the other company, the benefit of the exemption could not be denied to the appellant.

3. Ownership of Brand Name and Legal Precedents:
Legal precedents were cited to support the appellant's argument that using one's own name or a common name does not automatically disqualify them from the SSI scheme benefits. The Tribunal emphasized that the Revenue must substantiate claims of brand name ownership by another party to justify denying exemption benefits. The appellant's reliance on a Supreme Court judgment and a Board's Circular further strengthened their case, asserting that the use of a brand name not owned by a specific entity should not impact SSI benefits.

4. Benefit for Factories in Rural Areas:
Considering the appellant's location in a rural area, it was noted that factories in such areas are exempted from certain provisions of the Notification. The appellant contended that even if the use of the "Leo" nameplate was deemed as using another's brand name, the rural area exemption should apply. Although the certificate proving rural area location was not initially presented, its subsequent issuance supported the appellant's argument. The Tribunal, having ruled in favor of the appellant on other grounds, did not delve into this specific plea or the limitation-related submissions.

In conclusion, the Tribunal allowed the appeal, granting consequential relief to the appellant based on the detailed analysis of the issues surrounding the use of the brand name "Leo" and the eligibility for Small Scale Industries Exemption benefits.