1997 (4) TMI 226 - AT - Central Excise

Summary

Issues:
Dispensation of pre-deposit of duty and penalties in common proceedings against the applicants involving duty and penalty amounts, eligibility of Notification 175/86 and Notification 1/94 for goods manufactured under the brand name of a foreign brand owner, divergent views on notification eligibility by the Tribunal, duty liability for goods without the brand name, introduction of statutory penalty provision, levy of 100% statutory penalty, compliance with pre-deposit conditions.

Analysis:
The judgment pertains to applications filed for the dispensation of pre-deposit of duty and penalties levied under the impugned order in common proceedings against the applicants. The duty amounts and penalties involved in each case were specified, ranging from Rs. 28,550 to Rs. 12,71,000. The period of dispute was from April 1990 to May 1994. The duty was demanded on the grounds that the appellants had manufactured photocopiers under the brand name of Cannon and without any brand name using imported components.

The appellants' advocate argued that the appellants should not be denied the benefit of Notification 175/86 and Notification 1/94 as the brand name used belonged to a foreign brand owner. He referenced a case involving Sharp Business Machines where the Tribunal had conflicting views on the eligibility of the notification, leading to a reference to a Larger Bench for resolution. The advocate contended that duty attributable to goods with the foreign brand name should not be demanded. For goods without the brand name, the duty liability was stated to be Rs. 3,06,600, which was confirmed by the Judicial Department Representative (JDR).

Considering the arguments presented, the tribunal observed that the appellants were prima facie entitled to the dispensation of pre-deposit of duty for goods bearing the foreign brand name Cannon. The advocate submitted a statement of duty payable year-wise, which was reviewed by the JDR, confirming its accuracy. Additionally, the tribunal noted that statutory penalty provisions were introduced on a specific date and that a 100% penalty could not be levied based on a Supreme Court judgment.

As a result, the tribunal ordered M/s. Nu-Tread to pre-deposit Rs. 4 lakhs by a specified date and report compliance accordingly. Upon compliance, the pre-deposit of the remaining duty and penalties would be dispensed with, and the recovery stayed pending appeals. The case was scheduled for compliance reporting on a specified date.

This detailed analysis encapsulates the key issues addressed in the judgment, including the dispensation of pre-deposit, eligibility of notifications, duty liabilities, statutory penalties, and compliance requirements, providing a comprehensive overview of the legal proceedings and decisions made by the tribunal.