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2016 (8) TMI 239 - AT - Central ExciseSSI Exemption - Availing of exemption under notification no.8/2003 when appellant using brand name of others prior to its registration Held that brand name is a common brand and appellant used it prior to the other person registration impugned order deserves no merit - appeal allowed. Demand of duty from the firm dissolved on the death of the partner Held that demand of duty not sustainable. Both issues decided in favor of appellant impugned order set aside appeal allowed with consequential relief.
Issues Involved:
1. Entitlement of the appellant to exemption under Notification No. 8/2003-CE when using a brand name prior to its registration by another entity. 2. Sustainability of proceedings against the appellant firm upon the death of one of its partners. Detailed Analysis: Issue 1: Entitlement to Exemption under Notification No. 8/2003-CE The appellant contested the denial of exemption under Notification No. 8/2003-CE on the grounds that they were using the brand name "SAGAR" before it was registered by M/s. Sagar Machine Tools Pvt. Ltd. (SMT). The appellant argued that the brand name was initially registered in their father's name in 1958 and later in their own name in 1978. They contended that SMT only applied for registration in 1996, and thus, the appellant had prior use of the brand name. The Tribunal referred to a previous decision in the case of M/s. Sagar Machine Tools Pvt. Ltd., where it was established that the appellant was using the brand name "SAGAR" before SMT's registration in 1996. The Tribunal noted that the brand name was a common brand, initially registered in the name of the appellant's father and used by several parties. Therefore, the appellant could not be denied the exemption under Notification No. 8/2003-CE. The Tribunal also cited the case of Novel Tronics Corporation, where it was held that an entity using a brand name before its registration by another party is entitled to the SSI exemption. Based on these precedents, the Tribunal concluded that the appellant was entitled to the benefit of exemption under Notification No. 8/2003-CE, as they had been using the brand name "SAGAR" prior to its registration by SMT. Consequently, the impugned order was set aside, and the appeal was allowed with consequential relief. Issue 2: Sustainability of Proceedings Against the Firm After Partner's Death The appellant argued that the demand against the firm was not sustainable following the death of one of its partners, Mr. Satpal Singh, citing the Supreme Court's decision in the case of Shabina Abraham. The Tribunal examined the Supreme Court's observations, which distinguished between the dissolution of a firm and the death of an individual. The Court held that while a dissolved firm could be reassessed for pre-dissolution liabilities, the death of an individual ceased their liability unless the statute provided otherwise. The Tribunal noted that the Central Excises and Salt Act did not contain provisions to continue assessment proceedings against a deceased individual. Therefore, in light of the Supreme Court's ruling, the Tribunal held that the demand of duty could not be fastened on the firm, which had been dissolved following the partner's death. As a result, the demand against the dissolved firm was deemed unsustainable. Conclusion: Both issues were decided in favor of the appellant. The Tribunal set aside the impugned order and allowed the appeal with consequential relief, if any. The appellant was entitled to the benefit of exemption under Notification No. 8/2003-CE, and the demand against the dissolved firm was not sustainable following the partner's death.
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