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TMI Blog2011 (6) TMI 693X X X X Extracts X X X X X X X X Extracts X X X X ..... t it only expanded the meaning of "brand name", which in our view is only clarificatory. We therefore hold that the amendment to section 2 introducing "brand name" under clause (viaa) is only explanatory or clarificatory to the term "brand name" contained in section 5(2) which was there in the statute from 1998 onwards. We, therefore, allow the revision case by reversing the orders of the Tribunal and by restoring the assessment order. Consequently, the WP(C) filed by the petitioner-assessee will stand dismissed. - ST. Rev. No. 55 of 2010, WP(C) No. 8969 of 2011 - - - Dated:- 27-6-2011 - RAMACHANDRAN NAIR C.N. AND RAY B.P., JJ. For the Appellant : GOVERNMENT PLEADER For the Respondent : SRI.ANIL D. NAIR The judgment of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... heir franchisees at wholesale price. The assessee's case is that since they have purchased the items from the sister concerns, sales made by them are second sales which are exempt from tax as the products are taxable at the point of first sale in the State. However, the case of the Department is that real sale is the sale made by the assessee-firm under the brand name to the franchisees, which is the deemed first sale by virtue of section 5(2) of the Act. 5. For deciding the case, the scope and application of section 5(2) of the Act have to be considered and therefore, we extract hereunder the said section for easy reference: 5. (2) Notwithstanding anything contained in this Act, in respect of manufactured goods other than tea, w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... word covered by the original section and therefore, sale under trade name justifies assessment for the year 2003-04. Even though the assessee did not file a revision against the Tribunal's order, wherein the Tribunal held that the assessee's sales will be covered by section 5(2) of the Act for the year 2004-05 onwards, the assessee has challenged directly the assessment for that year by filing the writ petition for a declaration that no assessment under section 5(2) of the Act is permissible even for the subsequent years. Even though the assessee has not produced the Tribunal's order or challenged the same in the WP(C), during hearing learned counsel sought our permission to challenge the findings rendered by the Tribunal with r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee, which is a partnership firm controlling the manufacturing companies, should be ignored and the assessee's sales which are wholesales exclusively to franchisees in the State should be treated as the first sales. Since the assessee is the exclusive owner of the brand name and trade mark and logo, which are conspicuously inscribed on every product pack in red-ink with decoration as shown above, the assessee's sales are rightly assessed by the assessing officer as first sales under section 5(2) of the Act is the contention of the State. 8. The learned counsel appearing for the assessee submitted that ayurvedic products are prepared by applying a standard formula and products are sold in generic names like Dasamoolarishtam, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hrough its exclusive franchisees in the State and every product label affixed on the packets or bottles is printed with the trade name SD Pharmacy with the design and get up as shown above. The purpose is only to relate the products with the assessee, which has declared in the trade name itself that it has 70 years of rich experience in the field of manufacturing and marketing of ayurvedic products. 10. In our view, the scope and meaning of brand name or trade mark, use of either of which attracts liability on sale of products under section 5(2) of the Act, have to be considered keeping in mind the purpose of introduction of the section to the statute. It is common knowledge that when sales are made between the related concerns within th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... products to the assessee-firm are private limited companies exclusively under the control of the partners constituting the assessee-firm. 11. The learned Government Pleader also relied on a Division Bench judgment of this court presided over by the then honourable Chief Justice H.L. Dattu, in T.R.C. No. 414 of 2002 dated October 22, 2007 (A. Baiju, Shaju Bakery v. State of Kerala) wherein the use of brand name SB for sale of bread was held to be a brand name attracting liability under section 5(2) of the Act. 12. Going by our above findings, we hold that the sales made by the assessee-firm is deemed to be the first sales assessable under section 5(2) of the Act. We are also not able to uphold the order of the Tribunal that with the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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