2017 (2) TMI 979 - AT - Central Excise

SSI Exemption - the party never declared to the department that they were clearing the goods under the brand name belonging to the other person - Held that - the respondent entertained a bonafide belief that they were eligible for the benefit of SSI notification appears to be reasonable and fair - the judgement of the Apex Court in the case of Astra Pharmaceuticals (P) Ltd. 1994 (12) TMI 77 - SUPREME COURT OF INDIA which was delivered sometime in 1995 was being relied upon by this Tribunal to allow SSI benefit - appeal dismissed - decided against Revenue.

Summary

Issues:
- Appeal against Commissioner (Appeals) order
- Allegation of unauthorized use of brand name
- Demand confirmation by adjudicating authority
- Applicability of Supreme Court judgments
- SSI exemption eligibility
- Revenue's appeal grounds
- Limitation issue

Analysis:
1. Appeal against Commissioner (Appeals) order:
The Revenue filed an appeal against the order of the Commissioner (Appeals) regarding the demand confirmation related to the alleged unauthorized use of a brand name by the appellants.

2. Allegation of unauthorized use of brand name:
It was alleged that the brand name "HERBALWAYS" used on the products manufactured by the appellants actually belonged to another entity. The adjudicating authority confirmed a demand of ?11,78,931 based on this allegation.

3. Demand confirmation by adjudicating authority:
The adjudicating authority held that the brand name was used as a trademark by the appellants, citing Supreme Court judgments and imposed a penalty under section 11AC of the Act.

4. Applicability of Supreme Court judgments:
The Commissioner (Appeals) upheld the demand based on the judgment of the Apex Court in a specific case, while the Revenue contended that the cases relied upon were not applicable to the present case.

5. SSI exemption eligibility:
The Tribunal considered the issue of SSI benefit eligibility in light of the Supreme Court judgments and the period of the case, concluding that the appellants had a bonafide belief in their eligibility for the SSI notification benefit.

6. Revenue's appeal grounds:
The Revenue's appeal mainly focused on the appellants not declaring to the department that they were using a brand name belonging to another entity, emphasizing the non-availability of SSI notification bearing brand names of others.

7. Limitation issue:
The Tribunal noted that the notice was issued in 2005 for a period from 2000 to 2002, and considered the timeline of relevant Supreme Court judgments impacting the SSI benefit eligibility, ultimately upholding the Commissioner (Appeals) order and rejecting the Revenue's appeal.

In conclusion, the Tribunal found no infirmity in the Commissioner (Appeals) order, upholding the decision based on the appellants' bonafide belief in SSI benefit eligibility and the specific circumstances surrounding the use of the brand name in question.