2016 (9) TMI 727 - AT - Central Excise

SSI exemption - use of Brand Name belong to the assessee or not - similar Brand Name - Held that - It is visible clearly and seen by the naked eye that the Brand Name ; which is registered in the appellant s name definitely is different than the Trade Mark registered in the name of M/s Navin Bharat Industries Pvt. Ltd. On this point and merits itself, we find that the impugned order is unsustainable and liable to be set aside and we do so; as there being no dispute that appellant is using only the Trade Mark assigned their products. The reliance placed by the learned Departmental Representative in the case of Rukmani Pakkwell Traders (2004 (2) TMI 69 - SUPREME COURT OF INDIA), will not carry their case any further, in as much as in that case; the registration was Brand in the name of more than one person. Registration with the Trade Mark Authority of the Brand Name in this case as reproduced herein is in the name of appellant. Accordingly when the Brand Name is in the name of appellant benefit of SSI exemption in accordance with law needs to be extended to appellant. Benefit of exemption allowed - Decided in favor of assessee.

Summary

Issues:
1. Eligibility for Small Scale Industry (SSI) exemption based on brand name registration.
2. Interpretation of brand name ownership and registration.
3. Consideration of factory location under Rural Area exemption.
4. Bar on demand due to limitation period.
5. Validity of penalties imposed for duty evasion.

Analysis:
1. The appeal challenged the denial of Small Scale Industry (SSI) exemption by the Commissioner of Central Excise due to a disputed brand name registration. The appellant, a manufacturer of PVC conduit pipes, claimed the brand name "Gprecision" belonged to them, not to another entity. The lower authorities alleged similarity with a registered brand of a group company, leading to duty demand and penalties.

2. The appellant argued that their brand name registration predated any conflicting registration and highlighted the distinct style and ownership of the brand. The Tribunal examined the brand name registration certificates, confirming the brand belonged to the appellant, not the other entity. The Tribunal disagreed with Revenue's contention, emphasizing the appellant's exclusive use of the registered brand.

3. The issue of factory location within a Rural Area for exemption consideration was raised. The Tribunal noted the clarification regarding the factory's rural location, supporting the appellant's claim for exemption under Notification No. 9/2004. The Revenue's argument against the rural status was dismissed based on the provided evidence.

4. The appellant contended that a significant portion of the demand was time-barred due to lack of suppression or misstatement. The Tribunal acknowledged the absence of deliberate evasion and upheld the appellant's argument on limitation, barring the demand for earlier periods.

5. Regarding penalties imposed for alleged duty evasion, the Tribunal emphasized the absence of deliberate suppression or misstatement. Citing legal precedent, the Tribunal ruled that penalties were unsustainable when no intent to evade duty existed. The impugned order was set aside, allowing the appeal with consequential relief, highlighting the importance of brand name ownership in determining SSI exemption eligibility.