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TMI Blog1994 (11) TMI 228X X X X Extracts X X X X X X X X Extracts X X X X ..... erms of Notification No. 175/86, dated 1-3-1986 as amended. During their visit to the appellants factories on 17-9-1990 the Central Excise officers verified of their records and also recorded the statement of Shri Balkrishna A. Sharma, Commercial Executive and Shri Janak G. Nanavati, partner of the firm. After further investigations both the appellant firms were served with the show cause notices dated 2-7-1991 alleging that they were not entitled for the benefit of exemption in terms of Notification No. 175/86 as amended, since they were affixing the brand name TEFLON of M/s. E.I. Dupont of U.S.A. who were not entitled for exemption under the Notification No. 175/86-C.E. on the packings of their goods as well as different documents. The show cause notices further alleged that the appellants had contravened the provisions of Rule 173B, 9(1) read with Rule 173F and 173G inasmuch as they had failed to file the correct classification list and thereby failed to determine and pay the correct Central Excise duty. On these grounds M/s. Unnati Corporation and M/s. Unnati Industries were asked to show cause as to why duty amounting to Rs. 37,74,734/- and Rs. 29,11,612/- respectively for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h explanation VIII of the said notification since the trade mark Teflon on the cartons used for packing the tapes in question was not owned by any person in relation to the appellants product namely, Teflon Coated Fibre Glass Tape. He stated that the trade mark `Teflon was owned by M/s. E.T. Dupont of U.S.A. only in relation to the resin `Poly-tetrafluro-ethylene (PTFE) and not in respect of fibre glass tape coated with such resin. In this regard he prayed that the Misc. application No. 501 to 502/94-D for taking on record the following additional documents which could not be filed earlier because of bona fide error and which confirm the well- known fact that Teflon is a registered trade mark of E.I. Dupont De Nemours Co. Inc. U.S.A. only for PTFE and not for any product made out of Resin PTFE may be permitted to be taken on record :- (i) Certificate dated 4-4-1991 of Remfry Sugar Attorney at Law, Bombay certifying that `Teflon is a registered trade mark of E.I. Dupont De Nemours Co. Inc., USA under registration No. 258487 in respect of `Resinous Moulding Powder and extruding composition and Solution and Emulsion of Resinous plastic materials all included in class-1". ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted as assessable value but has to be treated as cum-duty price and duty payable is deducted in terms of Section 4(4)(d)(ii). A list of decisions in support of the aforesaid legal position is enclosed as Annexure-1. Without prejudice to the various submissions made on the merits, the demand for differential duty has been incorrectly computed for this reason also." 4. Continuing his submissions the ld. counsel for the appellants stated that clause 7 of Notification No. 175/86-C.E., dated 1-3-1986 have been struck as violative of Article 14 of the Constitution by the Calcutta High Court and also by a Division Bench of the Allahabad High Court. He contended that under these circumstances the Tribunal will have to read the notification by omitting clause 7 altogether. He argued that even though there was a contrary judgment of the Karnataka High Court upholding the validity of clause 7 of the said notification, the Tribunal would be bound by the judgment of the Division Bench of the Allahabad High Court. He contended that the impugned order suffers from non-application of mind since the appellants plea before the adjudicating authority that they were not affixing any trade mark on t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sought to invoke the extended period on the grounds of suppression of facts and the Collector after holding that the charge of suppression had not been established went on to confirm the demand for extended period on the grounds of mis-statement or mis-declaration with the intent to evade duty, even though no such allegation was made in the show cause notice. He stated that the Collector s finding in regard to mis-declaration was erroneous since the appellants had correctly stated in the relevant classification lists that they were not manufacturing goods bearing the brand name of any other manufacturer who was not eligible for grant of exemption under Notification No. 175/86. In this regard he reiterated his stand that the mark `Teflon occurring on the cartons used for packing the Teflon coated fibre glass tapes and fabrics manufactured by the appellants was not the registered trade mark of any person in respect of such tapes and fabrics. He added that in any case the department was throughout aware of the appellants activity and the nature of their products since the classification lists filed from time to time were approved and the RT-12 returns filed alongwith relevant invoic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s and fabrics. He argued that use of any trade mark by a small scale unit on its goods which belong to another person who is not entitled to the exemption under the said notification would be sufficient to debar the unit from the benefit of exemption under the notification. He stated that the decisions in the cases of Precise Electronics and Opus India cannot be of any assistance to the appellants since the facts in those cases were not the same as in the appellants case. He contended that the extended period in terms of proviso to Section 11-A was correctly invoked by the Collector since the appellants were using the trade mark of another person who was not eligible for the exemption under the notification whereas in the classification lists filed from time to time they had deliberately made incorrect declarations that they were not using the trade mark of any other person on their goods. 6. We have examined the records of the case and considered the submissions made on behalf of both sides. The ld. counsel for the appellants has pointed out that para 7 of Notification No. 175/86-C.E., dated 1-3-1986 as amended by Notification No. 223/87-C.E., dated 22-9-1987 has been struck do ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in para 60 above. We, therefore, feel duty-bound to determine ourselves, this issue; namely, continuation of proceedings pending at the time of the respective amendments, and adopting the view of Madhya Pradesh High Court as enunciated in Gwalior Rayon case (supra), we hold that these proceedings can continue, which view a Bench of this Tribunal already expressed, without much controversy having been raised in the case of Carew Co. Ltd. v. Collector of Central Excise, Allahabad [1983 (13) E.L.T. 1186] (CEGAT). Another Bench of this Tribunal (NRB) also held similarly in case : Sri Ram Pistons and Rings Ltd. v. CCE, Meerut [1980 (6) E.L.T. 927]. 7. In view of the foregoing we adopt the Karnataka High Court judgment in the case of Nectar Beverages Pvt. Ltd. (supra) and proceed to examine the other points raised by the appellants. 8. One of the points raised by the appellants is that they had contended before the adjudicating authority that only on the cartons in which Teflon Coated Glass Fibre adhesive tapes were being packed, the mark Teflon had been used whereas Teflon Coated Glass Fabrics were cleared in the form of rolls having brown paper covering but without any marking ..... X X X X Extracts X X X X X X X X Extracts X X X X
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