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2009 (6) TMI 490 - AT - Central ExciseSSI Exemption- The respondents M/s. Star Drive Bus Duct (P) Ltd. (SDBL) had manufactured and cleared bus ducts of varying capacities failing under Chapter Heading 8544 of the First Schedule to the CETA 1985 without paying duty due on them during the period 1995-96 to June 2000. The respondents had also cleared scrap of aluminum steel and copper without declaring the same in the classification list and without following other Central Excise formalities including payment of duty. A quantity of metal scrap was seized on 29-4-2000 and a quantity of bus ducts seized on 17-6-2000. Three trucks were also seized on 17-6-2000 as they were found laden with bus ducts found to have been cleared without payment of appropriate central excise duty due on them. Adjudicating a Show Cause Notice issued in this connection the original authority found that the respondents had been clearing bus ducts bearing the brandname STARDRIVE belonging to sister concern of the respondents M/s. Star Drive Engineers Pvt. Ltd. (SDEL). Held that- set aside the impugned order to the extent it relates to bus ducts and restore the order of the original authority. The appeal filed by the Revenue is allowed.
Issues:
1. Duty on bus ducts clearance without payment 2. Confiscation of scrap and bus ducts 3. Penalty imposition on the respondents and the Managing Director Analysis: 1. The case involved an appeal by the Revenue against the respondents for manufacturing and clearing bus ducts without paying the appropriate central excise duty. The original authority confirmed the duty demand, imposed penalties, and confiscated seized items. The Commissioner (Appeals) vacated the duty demand, penalties, and confiscation. The appeal challenged the duty demand, confiscation, penalties, and ownership of the brand name 'STARDRIVE' used on the bus ducts. 2. The respondents claimed they believed they could avail the Small Scale Industries (SSI) exemption for bus ducts with the brand name 'STARDR1VE.' They argued that the confusion regarding brand ownership was clarified later. The Revenue contended that the respondents knowingly misdeclared information and availed inadmissible SSI exemption, supporting the original authority's decision. 3. The Tribunal analyzed the facts and submissions. It found that the brand name 'STARDRIVE' was registered by a sister concern for various products, including bus ducts. The respondents falsely declared brand ownership to benefit from SSI exemption. The Tribunal upheld the original authority's decision, stating that the longer limitation period was correctly invoked. It deemed the duty demand, confiscation, and penalties lawful. 4. The Commissioner (Appeals) erred in presuming brand ownership, leading to vacating the penalties. The Tribunal disagreed, citing the brand's registration history and its use by the sister concern. Previous clarifications by the CBEC and Tribunal decisions supported disentitling SSI exemption for using the same brand name on different products. The Tribunal rejected the respondents' claim of bona fide belief and upheld the longer limitation period due to willful misrepresentation. 5. The Tribunal set aside the Commissioner (Appeals) decision and reinstated the original authority's order on bus ducts, duty demand, confiscation, and penalties. The appeal by the Revenue was allowed. The judgment was pronounced on 15-6-2009. This detailed analysis highlights the legal intricacies and reasoning behind the Tribunal's decision on the issues raised in the case.
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