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TMI Blog2008 (8) TMI 108X X X X Extracts X X X X X X X X Extracts X X X X ..... acuum Regulators during the year 1998-99 to 2000-01 under the brand name "Advance" claiming small scale excise exemption. This brand name "Advance" according to Revenue belong to Capital Controls Co., USA, and therefore it is Revenue's contention that the exemption was wrongly availed by them as the brand name "Advance" do not belong to them but belong to M/s. Capital Controls Co., USA. Accordingly a show cause notice was issued on 28-3-2002 to the assessee and its Managing Director Shri M.B. Kocha alleging evasion of duty amounting to Rs. 9,57,830/- invoking extended period by alleging suppression of fact of using the brand name "Advance" belonging to another person. The matter was adjudicated by Jt. Commissioner who confirmed duty of Rs. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... red User Agreement, Capital Controls Co., USA is the sole owner of the trade mark and the user was directed that the trademark shall be used in a way to clearly indicate that the same belong to Capital Controls Co., USA (Clause 9). Further Clause 10 of the said agreement specifies that the assessee shall not acquire any ownership interest in the Trade marks by virtue of use of the same. The products have to be marked with the legend "Manufactured in India under Licence from Capital Controls Co. Inc... Colmar, Pennsylvania USA". This agreement further impose following conditions on the user:- (1) Not to use, adopt or register it as a trade mark or trade name, whether during the terms of the agreement or after termination of the to the agree ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... non-manufacturing trader. Similar view was taken in the case of Wavetronics v. CC, New Delhi as reported in 2000 (121) E.L.T. 553 (Tribunal) = 2001-(XC2)-GJX-0526-CEGAT. 6. As regards limitation it was contended that Commissioner (Appeals) as pending has not given any separate findings except holding that since the respondents are entitled to exemption the demands cannot be considered as hit by limitation. It was submitted that in the classification declaration filed by the respondents and in their correspondence with the department, they nowhere declared that the brand name "Advance" belonged to Capital Controls Co., USA and is being used under licence from them which use does not confer the right of ownership and therefore there was a m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... applicable and benefit of exemption has been rightly availed. The matter was carried to the Hon'ble Supreme Court as reported in 2003 (157) E.L.T. 4 (S.C.) where Apex Court held that once it is held that there was an assignment of trade mark in favour of the first respondent which fact was not in serious dispute, the mere fact that the assignment was not registered could not alter the position. 9. In view of above it was submitted that once the brand name was assigned in favour of the respondent and the licensor has undertaken not to use the same in India, the exemption cannot be denied. He also invited our attention to para (ix) of the reply to the show cause notice dated 25th June 2002, wherein it has been stated by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re right to use, as the wordings are carrying the brand name belonging to another person. Mere right to use the brand name without objection from the owner does not confer ownership and accordingly the benefit of exemption under Notification 1/93 and similar Notifications cannot be extended. This view is supported by Hon'ble Supreme Court's decision in the case of Prince Valves Industry v. CCE, Chandigarh - 2006 (196) E.L.T. 141 (S.C.) =2007 (8) S.T.R. 440 (S.C.) wherein it was held that the appellant has only limited right to use brand name under registered trade mark but ownership of trade mark was not transferred to the appellant and in such circumstances the exemption under Notification No. 1/93-C.E. is not available. Similarly the Trib ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... red to by ld. Advocate also makes it clear that the foreign supplier still maintained the right to a the use of trade mark to others but only undertook not to assign to anyone-else in India during the pendency of the agreement. He had the right to assign it after termination of agreement. Further they were still at liberty to use it outside India. Notwithstanding the fact pointed out by the ld. Advocate that on being taken over by U.K. Company, they stopped using the brand name "Advance", Larger Bench of the Tribunal has in the case of Namtech Systems Pvt. Ltd. cited supra held that this small scale exemption will not be available to specified goods if they are affixed with the brand name or trade name of foreign person or a trader wh ..... X X X X Extracts X X X X X X X X Extracts X X X X
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