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2022 (2) TMI 616 - AT - Central ExciseSSI Exemption - use of brand name of others - allegation is that use of brand name Le Royal Meridien and were clearing cakes, cookies and pastries without payment of duty by claiming the exemption under Notification No.8/2003-CE dated 01.03.2003 - appellant has entered into an agreement with M/s.Le Royal Meridien and Meridien SA and by such agreement, the appellant has been licensed to use the brand name of Le Royal Meridien - HELD THAT - The very same issue was considered, analyzed and discussed in the appellant s own case for a different period in M/S. APPU HOTELS LTD. SHRI A. SENNIMALAI VERSUS COMMISSIONER OF CENTRAL EXCISE, CHENNAI I 2018 (7) TMI 241 - CESTAT CHENNAI wherein the Tribunal held The appellants have entered into an agreement with Meridien SA dated 12.4.2000 by which they have acquired the brand name Le Royal Meridien . They have been given the exclusive right to use the brand name till the expiry of the agreement. Therefore, it cannot be said that they are using the trademark of another person. The demand cannot sustain - Appeal allowed - decided in favor of appellant.
Issues:
- Applicability of Notification No.8/2003-CE dated 01.03.2003 regarding SSI exemption for goods cleared using a brand name of another. - Interpretation of "brand name" or "trade name" as per the notification. - Legal validity of using a brand name under an agreement. - Consideration of past tribunal decisions on similar issues. - Assessment of penalty imposed on the Managing Director. Analysis: 1. Applicability of Notification No.8/2003-CE: The case involved the question of whether the appellant could be denied the benefit of exemption under Notification No.8/2003-CE dated 01.03.2003 for clearing goods using the brand name of another entity. The department alleged that the appellant used the brand name "Le Royal Meridien" for their products, which could disqualify them from the SSI exemption. However, the appellant argued that they did not use any brand name on the goods cleared and had a legal agreement with "Le Royal Meridien" to use the brand name. 2. Interpretation of "brand name" under the notification: The notification defined "brand name" or "trade name" as a name or mark used in relation to specific goods to indicate a connection in the course of trade with a person using that name or mark. The appellant had an agreement with "Le Royal Meridien" allowing them to use the brand name, which, according to the appellant, did not constitute the use of another person's brand name. 3. Validity of using a brand name under an agreement: The appellant had entered into a licensing agreement with "Le Royal Meridien" to use their brand name legally. Citing a previous tribunal decision and a Supreme Court judgment, the appellant argued that when a foreign brand name owner assigns the trademark to an Indian company with exclusive usage rights, the Indian company is entitled to SSI exemption. The Tribunal found that the denial of SSI exemption in this case lacked a valid basis. 4. Consideration of past tribunal decisions: The Tribunal referred to a previous decision in the appellant's own case for a different period where a similar issue was addressed. In that case, it was held that the appellant, by having the exclusive right to use the brand name, was not using the trademark of another person, thus entitling them to the SSI exemption. 5. Assessment of penalty on the Managing Director: The Tribunal set aside the penalty imposed on the Managing Director of the appellant company, aligning with the decision to allow the appeal and provide consequential relief. The impugned orders were set aside, and the appeals were allowed based on the legal interpretation and agreements regarding the use of the brand name in question. In conclusion, the judgment focused on the legal validity of using a brand name under a licensing agreement and interpreting the provisions of Notification No.8/2003-CE for SSI exemption. The Tribunal's decision was influenced by past rulings and legal principles, ultimately leading to the allowance of the appeal and the setting aside of penalties.
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