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TMI Blog2016 (1) TMI 432X X X X Extracts X X X X X X X X Extracts X X X X ..... neer Selvam, AC (AR) ORDER Per: P.K. Choudhary All the 13 appeals are taken up together for disposal, as the issues involved in these appeals are identical in nature. The appellants are manufacturers of Aerated Water and soft drinks under the brand name of Kali Mark . They marketed various flavours in the name of Kali Kola , Bovonto , Solo , Frutang , Captain , Trio , Club Soda etc., and claiming SSI exemption under Notification No. 8/2003-CE dated 01.03.2003 as amended. The adjudicating authority in all these cases denied the benefit of exemption notification on the ground that the brand name of Kali Mark , Bovanto and Frutang are the brand name of other persons and held that they are liable to pay central excise duty with interest under Section 11 A (1) and 11 AB of the CEA, 1944 and imposed penalty under Rule 25 of CER, 02, and rejected the appeals filed by all the appellants. Hence, the present appeals. 2. The brief facts of the cases are that M/s. Kali Aerated Water Works was founded by P.V.S.K. Palaniappa Nadar in the brand name and trade mark of Kali Mark in the year 1916 and established factories in various places viz, Virudhunagar, Madurai, M ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dt. 22.3.11 01.04.09 to 09.07.09 34,138 34,138 12 260/11 -do- 145/11 dt. 22.03.11 01.04.08 to 22.08.08 83,018 83,018 13 387/12 -do- 97/12 dt. 24.05.12 01.04.10 to 19.06.10 15,44,913 3,75,000 3. The Ld. Advocate Ms. Sridevi appearing on behalf of the appellants submits that their business was done as a family business under the HUF identity till the same was partitioned on 31.03.77 and pursuant to this partition w.e.f. 01.04.77 all the units located at different places started functioning with their own financial investments as an individual unit and managed by the descendents of the founder and they continued the business in the name of Kali Aerated Water Works with the name of the place suffixed. They used the brand name concurrently without registration in the name of the owners of such independent units. Shri K.P.R. Sakthivel, Proprietor of the Madras unit got registration of the brand names ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... contrary to the Deed of Mutual Agreement which has been entered into between the erstwhile partners. Para 9 of the recital to this family arrangement is as under : Since all the parties herein have mutually intend to carry forward the reputation and well established Trade Mark KALI MARK in future also thus carrying out to the future generations, a meeting was held among the parties herein, who are the direct male lineal decedents and users of established abovesaid Trademarks and who at present have interest in various factories being run in the name of Kali Aerated Water Works in various parts of Tamil Nadu and discussed the pros and cons and also to preserve the established Trade Name and Trade Marks throughout the future generation and agreed on certain terms and conditions and all the parties herein have agreed to abide by them and hence this Deed of Mutual Agreement. 1. Thereafter, this aspect is dealt with in Paras L. M. and N thereof, which read as under : (L) If any party comes to know about any infringement and passing of use of any deceptively similar mark on any imitation by any person in the market, then the party in whose area the said imitation, inf ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... one of the partner of the erstwhile HUF Firm. The appellant have been marketing his products only within his own marketing area. It is not the case of the Revenue that any other person is using the same Brand names in the same area. Similarly the appellant is not selling his goods outside his marketing area. So far his business is concerned the appellant appears to be the only legal owner of the Trade Mark within his marketing area. This has been clearly brought out in the Mutual Agreement dated 12-3-1993 which has been duly presented on 12-3-1993 itself for registration whereas the impugned Notification No. 59/94 came into effect only from 1-4-1994 and hence no motive can be attributed against the appellant in respect of the Mutual Agreement. I have read the entire contents of Mutual Agreement. I find that Mr. K.P.R. Sakthivel is also a party to the said Mutual Agreement and no royalty is also payable to the said K.P.R. Sakthivel. Even Mr. K.P.R. Sakthivel has specifically agreed that he cannot use the brand name in the marketing area of the appellant. Thus there seems to be recognition of individual proprietary rights over the brand names within the respective specified marketin ..... X X X X Extracts X X X X X X X X Extracts X X X X
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