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2018 (1) TMI 1209 - AT - Central ExciseSSI Exemption - use of brand name of other person - Clandestine removal - parallel invoices - Held that - M/s. TCL is issuing purchase order for supply of goods namely, Defoamer under the brand name Neelco. Neelco is the brand of M/s. NASCPL. It is also a fact on record that the appellant is not using the said brand name on their products. Moreover, on the invoices also, the said brand name is not found mentioned in the invoices. These facts are not in dispute - However, we find that during the course of investigation, certain goods were found having the brand name of NASCPL. In that circumstance, the appellant cannot absolve their liability of using the brand name of another person, therefore, using the brand name of another person on the said goods found in their factory - similar issue came before the Hon ble Apex Court in the case of CCE, Ahmedabad vs. Vikshara Trading & Invest Pvt. Limited 2003 (8) TMI 49 - SUPREME COURT OF INDIA wherein the Hon ble Apex Court observed that if there was an assignment of trademark in fact of the assessee, the mere fact that the assignment deed is not registered can not alter the position - as the appellant is using the brand name of another person but it was by way of assignment deed. In that circumstances, the appellant is not using the brand name of another person but they are using their own brand name as assigned to them - benefit of SSI exemption N/N. 08/2003-CE dated 01.03.2003 cannot be denied to the appellant. Clandestine removal - parallel invoices - Held that - The Revenue has not come up with any positive evidence contrary to the explanation given by the appellant. Therefore, the Revenue has failed to come up with positive evidence in support of clandestine removal of goods. As no corroborative evidence has been produced by the Revenue and allegingd that on the strength of parallel invoices the appellant has cleared the goods, then the allegation of clandestine removal is not sustainable when M/s. TCL itself has explained that the explanation given by the appellant at the time of investigation is in terms of purchase agreement and monthly invoices has been raised as per purchase agreement - demand set aside. Appeal allowed - decided in favor of appellant.
Issues Involved:
1. Entitlement to SSI exemption under Notification No. 08/2003-CE dated 01.03.2003. 2. Allegation of clandestine clearance of goods using parallel invoices. Detailed Analysis: Issue 1: Entitlement to SSI Exemption under Notification No. 08/2003-CE dated 01.03.2003 The appellants were accused of using the brand name of another entity (NASCPL) and thus were allegedly not entitled to the SSI exemption under Notification No. 08/2003-CE dated 01.03.2003. The investigation revealed that certain goods bearing the NASCPL brand name were found in the appellant's premises. The appellant argued that they had an assignment deed allowing them to use the brand name, which was supported by the assignment deed placed on record. The Tribunal found that the appellant was not using the NASCPL brand name on their products or invoices, which was not disputed. However, due to the presence of branded goods in their factory, the initial liability could not be absolved. The Tribunal referred to the assignment deed, which legally permitted the appellant to use the brand name. Citing the Supreme Court's decision in CCE, Ahmedabad vs. Vikshara Trading & Invest Pvt. Limited, the Tribunal concluded that the assignment deed, even if unregistered, allowed the appellant to use the brand name. Consequently, the appellant was entitled to the SSI exemption. Issue 2: Allegation of Clandestine Clearance Using Parallel Invoices The second issue was the allegation that the appellant was clearing goods clandestinely using parallel invoices. The appellant contended that the goods were supplied to M/s. TCL on a performance basis, and final invoices were raised monthly as per the purchase agreement with M/s. TCL. The investigation did not produce any evidence contrary to the appellant's explanation. The Tribunal noted that the burden of proof for clandestine removal lay with the Revenue, which failed to provide any positive evidence. The Tribunal found that the explanation provided by the appellant, corroborated by M/s. TCL, was in line with the purchase agreement. The Tribunal referred to several judicial precedents, including the decisions in Golden Steel Corporation Limited vs. CCE, Kolkata and Continental Cement Company vs. UOI, which supported the appellant's case. Conclusion The Tribunal concluded that the demands on both issues were not sustainable. The show cause notice dated 13.04.2011 was also deemed unsustainable, as it invoked the extended period on the same grounds as an earlier notice dated 06.04.2009, in light of the Supreme Court's decision in Nizam Sugar Factory vs. CCE. The impugned orders were set aside, and the appeals were allowed with consequential relief. (Order pronounced in the court on 25.01.2018)
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