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2015 (7) TMI 961 - SC - Central ExciseSSI Exemption - Denial of the benefit of Notification No. 175/86 dated 01.03.1986 - Use of other company brand name - Held that - No doubt, when the brand name or trade name of another person is used by an SSI unit then the SSI unit shall not be entitled to the exemption from payment of excise duty under the aforesaid Notification No. 175/86. However, what is relevant is that the other unit of whose brand name or trade name is used, should be a unit which is not eligible for grant of exemption under this Notification. In the present case, we find that M/s Vikshara Trading itself was a SSI unit which has been claiming exemption and the same was allowed by the Tribunal in C.C.E., Ahmedabad v. Vikshara Trading and Investment Pvt. Ltd. 1996 (8) TMI 204 - CEGAT, NEW DELHI and the said judgment of the Tribunal has been upheld by this Court which is reported in 2003 (8) TMI 49 - SUPREME COURT OF INDIA . Accordingly, we set aside the impugned judgment of the Tribunal and hold that the appellant shall be entitled to the exemption under the aforesaid Notification - Decided in favour of assessee.
Issues:
- Denial of benefit of Notification No. 175/86 dated 01.03.1986 due to the use of a brand name belonging to another person. - Interpretation of para 7 of the said Notification. - Eligibility for exemption under the Notification when the brand name belongs to an SSI unit claiming exemption. Analysis: The Supreme Court addressed the issue of the appellant being denied the benefit of Notification No. 175/86 dated 01.03.1986 because they were using a brand name, 'SKYLARK,' owned by another entity, M/s. Vikshara Trading. The Customs, Excise and Service Tax Appellate Tribunal (CESTAT) based its decision on para 7 of the said Notification, which states that the exemption does not apply if the manufacturer affixes the goods with a brand name of another person not eligible for the exemption. However, the Court emphasized that for the exemption to be denied, the other unit whose brand name is being used must be ineligible for the grant of exemption under the Notification. In this case, M/s. Vikshara Trading, the owner of the brand name 'SKYLARK,' was itself an SSI unit claiming exemption, as evidenced in a previous judgment 'C.C.E., Ahmedabad v. Vikshara Trading and Investment Pvt. Ltd.' The Tribunal had allowed the exemption claimed by M/s. Vikshara Trading, a decision upheld by the Court in a subsequent judgment. Therefore, the Court concluded that since M/s. Vikshara Trading was eligible for exemption under the Notification, the appellant using their brand name should also be entitled to the exemption. Consequently, the Court set aside the Tribunal's decision and ruled in favor of the appellant, granting them the exemption under Notification No. 175/86 dated 01.03.1986. In summary, the Supreme Court's judgment clarified that the appellant, despite using a brand name belonging to another entity, was eligible for the exemption under the Notification as the entity owning the brand name was itself eligible for exemption. The Court's interpretation of para 7 of the Notification emphasized the importance of the eligibility of the entity owning the brand name for determining the applicability of the exemption.
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