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2023 (8) TMI 1303 - SC - Central ExciseSSI exemption - use of brand name of others - use of brand name of others - benefit of exemption under Notification dated 01.03.2002 bearing No.8/2002-Central Excise denied - HELD THAT - Reliance placed in the case of Commissioner of Central Excise, Hyderabad IV Vs. Stangen Immuno Diagnostics 2015 (6) TMI 155 - SUPREME COURT , wherein this Court while considering an earlier judgment in Bhalla Enterprises 2004 (9) TMI 109 - SUPREME COURT has noted the observations that if the assessee is able to satisfy the assessing authorities that there was no such intention or that the user of the brand name was entirely fortuitous and could not on a fair appraisal of the marks indicate any such connection, it would be entitled to the benefit of exemption. An assessee would also be entitled to the benefit of the exemption if the brand name belongs to the assessee himself although someone else may be equally entitled to such name. In the present case, there was a usage of a well known brand name SUNCA by the appellant(s), although it was registered by M/s. Sun Fat (Holding) Co. Ltd., which did not make a difference to the denial of the benefit of exemption to the appellant(s). The observations of this Court in Bhalla Enterprises has been culled out in the form of a test laid down in Stangen Immuno Diagnostics 2015 (6) TMI 155 - SUPREME COURT . A reading of judgement clearly indicates that in order to deny the benefit of exemption under the Notification, it must be established by the Department that (1) the goods in respect of which the exemption is sought use the same or similar brand name; (2) the said brand name is used with an intention of indicating a connection with the Assessees goods and such other person; and (3) use of such a brand name is to indicate such a connection. The appellant(s) in the instant case is manufacturing emergency lamps and, therefore, the use of brand name SUNCA in the instant case is only fortuitous, being no intention on the part of the appellant(s) to use the said brand name to show a connection with M/s. Sun Fat (Holding) Co. Ltd. The show cause notices were issued on an erroneous premise inasmuch as the Department itself had changed its line of arguments before CESTAT - Appeal allowed.
Issues Involved:
1. Legality of the use of the brand name "SUNCA" by the appellant. 2. Entitlement to the benefit of exemption under Notification No. 8/2002-Central Excise. Summary: Issue 1: Legality of the use of the brand name "SUNCA" by the appellant The appellant was found using the brand name "SUNCA" on their products, which was registered to M/s. Sun Fat (Holding) Co. Ltd., a manufacturer of rechargeable lamps and batteries. The Department argued that since the brand name "SUNCA" did not belong to the appellant, they were not entitled to the benefit of exemption under Notification No. 8/2002-Central Excise. The CESTAT accepted this contention and rejected the appeals filed by the appellant firm and the son of the appellant but allowed the appeal filed by the proprietor of the appellant firm, setting aside the imposition of a separate penalty on him. Issue 2: Entitlement to the benefit of exemption under Notification No. 8/2002-Central Excise The Supreme Court examined whether the appellant was entitled to the benefit of exemption under Notification No. 8/2002-Central Excise. The Court referred to previous judgments, including Commissioner of Central Excise, Delhi vs. ACE Auto Company Limited and Commissioner of Central Excise, Hyderabad IV Vs. Stangen Immuno Diagnostics, which established that the exemption would be denied if the brand name was used with the intention of indicating a connection with another person's goods. The Court found that the appellant did not intend to indicate any connection with M/s. Sun Fat (Holding) Co. Ltd. and that the use of the brand name "SUNCA" was fortuitous. The show cause notices were issued on an erroneous premise, and the Department had changed its line of arguments before the CESTAT. Therefore, the Supreme Court quashed the show cause notices, set aside the order of the CESTAT, and restored the order of the Appellate Commissioner, allowing the appeals filed by the appellant.
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