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TMI Blog2017 (3) TMI 372X X X X Extracts X X X X X X X X Extracts X X X X ..... 4136/2005 - A/85583-85586/17/EB - Dated:- 1-2-2017 - Shri Ramesh Nair, Member (Judicial) And Shri C J Mathew, Member (Technical) Shri S. Suriyanarayanan, Advocate for the appellants Shri H.M. Dixit, Asstt. Commissioner (AR) for the respondent Per: C J Mathew: Appeals of Cannon Trade Link, Charms Creation, Poonam Perfect and Ankit Apparels are taken up for disposal together as they arise out of identical disputes dealt with in common order-in-appeal no. BR/144-147/M-IV/04 dated 30 th September 2005 of Commissioner of Central Excise (Appeals), Mumbai Zone - I. 2. In brief, the appellants manufacture ready-made garments chargeable to duty with effect from 1 st May 2001 at 16% but had been claiming exemption from duty under notification no. 8/2001-CE dated 1 st March 2001 applicable to small scale units that fulfil certain conditions specified therein. It is alleged that, in violation of conditions of the said notification, the goods produced by the appellants had been marketed under brand names that did not belong to them. Accordingly, notices were issued for denial of benefit of exemption and the four were asked to show cause against proceedings for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed to such name. 7. The decision in Rukhmani Pakkwell Traders (supra) and Mahaan Dairies (supra) set aside the decision of the Tribunal holding to the contrary in the matter of Fine Industries reported in 2002 (146) E.L.T. 53. In the appeals which are being disposed of by us the decision in Fine Industries has been followed by the Tribunal and relief has been granted to the assessee s concerned without going into any other question. The learned Counsel for the different assessees have pointed out to us that in many of the appeals which are being disposed of today, there were other issues raised by them relating to limitation and ownership which would need a determination by the Tribunal. The orders in all these appeals are therefore being passed separately. C.A. No. 5387/2003; Commissioner of Central Excise v. Fine Industries, C.A. No. 4979-84/2001; CCE v. Swadesh Industries and CSA. No. 5389-5396/2003; CCE v. Swadesh Industries. is in their favour. It is further contended that the show cause notice does not allege the connection that has been elaborated in this judgment and, hence, their claim to relief on the basis of this judgment cannot be denied. It is also s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion would have expressed such intent. Nor can it be the intent of Central Government that branding is a privilege reserved for medium and large units. The exception accorded in the exemption notification to certain branded goods has a different objective. No uniform rule can be promulgated for admitting to the benefit or for denial of the exception. Each case must necessarily be dealt with according to the circumstances of the case and in accord with the exemption notification. 9. While taking note of the observation in re Rukmani Pakkwell Traders that exemption is lost if the goods of claimant of exemption and some other entity who owns the brand are similar and that it is also lost even if the brand names are unregistered, we also feel obliged to place the decision in the context of two entities that were engaged commercially in the same business and that the trader, thereafter, took up manufacture of the same product under a similar name. The scope for hiving out of production to derive tax advantage, without detriment to the commercial acceptance of the product, is the subterfuge that concerned the Hon ble Supreme Court sufficiently to disapprove of the broad interp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... words of the statute must be given effect to. It is only in the case of ambiguity that the principle of strict/liberal interpretation would arise. In the decision of Mangalore Chemicals Fertilizers Ltd. v. Deputy Commissioner, 1991 (55) E.L.T. 437 (S.C.) relied upon by the Counsel appearing on behalf of the assessees, there was no dispute that the assessee was entitled to the benefit of the exemption notification. The only dispute was as to whether the assessee should be permitted to avail of the benefit in the absence of prior permission being granted to the assessee in terms of the notification. This Court noted that if the conditions for grant of exemption were satisfied, the authority whose permission was made a pre-condition to the availability of the benefit, had no discretion to withhold the permission. It was held that the prior permission was a technicality and had admittedly not been granted by reason of considerations which were extraneous to the right of the assessee to obtain benefit under the notification. It was in these circumstances, that the Court approved the following passage in the Union of India Ors v. M/s Wood Papers Ltd. Ors., 1991 JT (1) 151 at pag ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndertakings that derive undue advantage from this exemption notification. 13. It would have been impossible for the Central Government to devise sentences that would describe precisely what is enabled and what is disincentivised by this exclusion. The scope of the exemption notification cannot also be so construed as to become a rule for denial of exemption. It would appear that there can be no express ban on use of the same brand by different entities large or small. From the explanation supra, it would appear that the intent to take advantage of the recognition enjoyed by another brand is critical to invoking of the exception provision. Such intent can be established by facts unearthed on investigation. Failure to carry out such investigation to establish such intent cannot be supplemented and complemented by adjudication orders, let alone appellate proceedings. The notice issued to appellants has not ventured to bring such intent to light. Indeed, no attempt has been made to even portray any advantage that the appellants derived from using these particular brands. That the owner of the brands has any market presence at all is not evinced from the records. 14. In these circ ..... 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