2018 (1) TMI 1083 - AT - Central Excise

SSI exemption - use of Brand Name - The whole case of the Department is based on the photographs taken from the premises of the buyer (SKIT) and the statement recorded by the Department of the Director and Registrar of the Institutes, which were retracted later - Held that - there is no material available with the Department to allege that the assessee-Appellants were using the brand name of another person. In fact, Rastogi is not a brand name of any other person and is being used by the family members. Rastogi is a surname/family name for which every family member is entitled to use. The Department has neither issued any notice nor examined the firms of family members who are also engaged in the similar line of business. Only the assessee- Appellants have been made target which is not desirable. Thus, the Department has made out a poor case. The assessee-Appellants have not used any registered brand name of the third party - the assessee-Appellants are entitled for the SSI exemption, as per law - Appeal allowed - decided in favor of appellant.

Summary

Issues:
- Dispute over excise duty demand on furniture seized during a search at the business premises.
- Allegation of selling furniture under a brand name "Rastogi" not registered with anyone.
- Claim for SSI exemption benefit under Notification No. 08/2003-CE.
- Department's case based on photographs and statements retracted by witnesses.
- Interpretation of using a family name in business as a brand name.

Analysis:
1. Excise Duty Demand Dispute:
The appeals were filed against the order demanding excise duty on furniture seized during a search at the business premises. The period in dispute was from 01.10.2009 to 09.10.2013. The duty demand was initially valued at &8377; 9,01,150/- but was later enhanced to &8377; 59,17,272/-, leading to penalties being imposed. The assessee-Appellants contested this demand, leading to the present appeals.

2. Brand Name Allegation:
The Department alleged that the assessee-Appellants were selling furniture under the brand name "Rastogi," which was not registered with anyone. The Department's case was based on the use of this brand name and the alleged connection with the sale of furniture. The assessee-Appellants argued that "Rastogi" was a family name used by all family members in their business and was not a registered brand name of any third party.

3. SSI Exemption Claim:
The counsel for the assessee-Appellants claimed the benefit of the SSI exemption under Notification No. 08/2003-CE due to the sale of furniture being within the prescribed limit. They argued that the family members were engaged in the business of steel/wooden furniture, and a common brochure was published, justifying the use of the family name "Rastogi."

4. Evidence and Retracted Statements:
The Department's case relied on photographs taken from the premises of buyers and statements from witnesses like the Director and Registrar of institutes, which were later retracted. The Tribunal noted that no furniture or sticker with the name "Rastogi" was found during the search. Buyers also denied that the furniture bore any logo or brand name.

5. Interpretation of Family Name as Brand Name:
The Tribunal referred to precedents where using a family name or brand name on letterheads did not amount to using a third party's brand name. In this case, as "Rastogi" was a family name used by all family members in their businesses, the Tribunal found that the assessee-Appellants did not use any registered brand name of a third party.

6. Judgment and Conclusion:
The Tribunal set aside the impugned order, ruling in favor of the assessee-Appellants. It concluded that the use of the family name "Rastogi" did not constitute the use of a registered brand name of a third party, thus entitling the assessee-Appellants to the SSI exemption as per law. The appeals filed by the assessee-Appellants were allowed, and the judgment was pronounced on 23.01.2018.