2000 (10) TMI 142 - AT - Central Excise

Summary

Issues Involved:
The primary issue is whether the appellants were wrongly denied the benefit as Small Scale Industrial (SSI) Units due to Notification No. 223/87.
1. Notification No. 223/87 and Denial of SSI Benefit:
The Department relied on Clause 7 of Notification No. 223/87 to deny SSI benefit to the appellants for using a brand name not entitled to exemption. The appellants used the trade names "spred" and "Glidden" on their products, raising the question of whether both are trade marks or if one is a 'house mark'.
2. Use of Trade Mark "Spred" by M/s. U.K. Paint Industries:
M/s. U.K. Paint Industries obtained permission to use the trade mark "spred" from their foreign collaborator, M/s. SCM Glidden Intl. Co. U.S.A., and registered it in their name. The appellants used this trade mark on their products, establishing their entitlement to SSI benefits.
3. Distinction Between Trade Mark and House Mark:
The use of "Glidden" as a house mark did not establish a trade relationship with the contents, unlike "Spred" which was a trade mark. The distinction between trade mark and house mark was crucial in determining SSI benefit eligibility, following precedents set by the Supreme Court and CEGAT.
4. Limitation and Correctness of Show Cause Notice:
The contention that the Show Cause Notice was time-barred was not pursued as the finding that the appellants were entitled to SSI benefits rendered the notice incorrect. The statement provided to the authorities in 1991 disclosing the use of trade marks supported the argument against the validity of the notice.
Conclusion:
The order imposing penalties and duties on the appellants was set aside, and all seven appeals were allowed in favor of the appellants, granting them consequential relief.