2019 (2) TMI 564 - AT - Central Excise

SSI exemption - use of brand name of others - the goods manufactured by the appellant is bearing the brand name SNT which as per the claim of department is owned by another person i.e. Shri. Dilipbhai J Rathod of M/s. Vidyut Motors Pvt. Ltd., Mumbai - appellant claims that the said brand name was assigned to them by assignment deed - N/N. 08/2003-CE dated 01.03.2003. Held that - The assignment deed was neither signed by the assignee nor by any witness in the assignment deed. The date of assignment was not mentioned, therefore, the assignment deed is not free from serious doubt. Even if for sake of argument if the assignment deed is accepted but the most important point is that if the brand name is assigned to the appellant, thereafter, the assignor has no locus standing, as regard the said brand name SNT , however, despite the assignment deed written the assignor M/s. Vidyut Motors PVT. Ltd applied for renewal of the trade mark SNT and the same was granted by the trade Mark registry. This makes it clear that the brand name SNT even after the period of assignment deed the trade mark SNT was owned by M/s. Vidyut Motors PVT. Ltd. It is only by an application made by the appellant to the trade mark registry on 06.12.2006, the appellant can be treated as owner of the brand name only w.e.f .06.12.2006. In this fact, the appellant is entitled for the SSI Exemption only for the period from 06.12.2006 onward. Time limitation - Held that - Though the appellant have declared the brand name SNT but the fact of ownership of brand name SNT was not disclosed , therefore, there is a clear mis-declaration and suppression of fact on the part of the appellant - demand cannot be held as time bar. Since the appellant is entitled for SSI Exemption from 06.12.2006 onward, the adjudicating authority shall make a re-quantification of demand and pass a fresh order - appeal allowed by way of remand.

Summary

Issues involved: Entitlement for SSI Exemption under Notification No. 08/2003-CE dated 01.03.2003 based on ownership of the brand name "SNT" assigned to the appellant.

Comprehensive Analysis:

Issue 1: Ownership of Brand Name
The appellant claimed ownership of the brand name "SNT" based on an assignment deed dated 08.04.1993. The appellant argued that subsequent actions, such as a deed of ratification in 2006 and trademark registration in 2008, reinforced their ownership. However, the Revenue contended that the assignment deed was questionable, pointing out discrepancies and the assignor's renewal of the trademark. The Tribunal examined the assignment deed and found it lacking essential details, concluding that the brand name "SNT" remained with the assignor until the appellant's application to the trademark registry in 2006. Therefore, the appellant was entitled to SSI Exemption only from December 2006 onwards.

Issue 2: Time Bar and Mis-declaration
Regarding the issue of time bar, the appellant argued that they had declared the use of the brand name "SNT" to the department, indicating no suppression of facts. However, the Tribunal found that while the use was declared, the ownership was not disclosed, constituting a mis-declaration and suppression of fact. Consequently, the demand was not time-barred.

Conclusion and Disposition
The Tribunal ruled in favor of the Revenue, stating that the appellant was entitled to SSI Exemption only from December 2006 onwards. The adjudicating authority was directed to re-quantify the demand and issue a fresh order. The appeal was disposed of through remand on these terms, emphasizing the importance of accurate disclosure in declarations to avoid mis-declarations and uphold tax obligations.

This detailed analysis of the judgment highlights the key legal arguments, findings, and implications related to the entitlement for SSI Exemption based on brand name ownership and the consequences of mis-declaration in tax matters.