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TMI Blog2022 (12) TMI 1463X X X X Extracts X X X X X X X X Extracts X X X X ..... 1.07.2009 - Commissioner has given no plausible reason for denying SSI exemption. Only during the financial year 2009-10 appellant had crossed the exemption limit as provided in terms of Notification No.8/2003-CE dated 01.03.2003. Accordingly central excise duty is demandable only for the said year and value of clearances which is beyond the exemption limit of Rs.1.5 crores. The total duty demand and interest and penalty under Section 11AC for the duty so short paid would be within the amount already deposited and appropriated by the Commissioner by the impugned order. Learned counsel has undertaken not to claim any refund in respect of the amount of Rs.3,00,000/- deposited and appropriated by the Commissioner - after allowing the benefit of Notification No.8/2003-CE dated 01.03.2003, the appeal is partly allowed. Appeal allowed in part. - HON BLE MR. SANJIV SRIVASTAVA, MEMBER (TECHNICAL) AND HON BLE DR. SUVENDU KUMAR PATI, MEMBER (JUDICIAL) Shri Shailesh P. Sheth, Advocate, for the Appellant Shri Amrendra Kumar Jha, Deputy Commissioner, Authorised Representative for the Respondent ORDER PER: SANJIV SRIVASTAVA This appeal is directed agains ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2007-08 13219134 2091957 41840 20918 3 2008-09 12609553 1562370 31248 15623 4 2009-10 16316653 1324701 26495 13246 5 2010-11 14438278 1443828 28877 14437 Total 2006-11 65723627 7885256 157707 65378 2.3 On completion of investigation, a show cause notice dated 06.05.2011 was issued to the appellant calling them to show cause as to why:- i. Central Excise duty amounting to Basic Rs 78,85,256 Education Cess Rs 1,57,707/- S HE. Cess Rs. 65,378/- aggregating to Rs 81,08,341/- (Rupees Eighty One lakhs Eight Thousand Three Hundred Forty One Only) as detailed in Annexure-B to this notice due on the said excisable goods, totally valued at Rs. 6,57,23,627/- manufactured and cleared from the said un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Shri Chandrakant Gosrani continued the business as proprietor in the same name and style as was continuing earlier. A separate affidavit dated 30.11.2005 was prepared in terms of the dissolution deed and affidavit ibid, whereby the present appellant Shri Chandrakant Gosrani was handed over all the rights to the said trade mark and logo. As the brand name was assigned by the existing partners in the name of the proprietor, he was clearing the goods using the said brand name and it has been held in series of decisions that the benefit of SSI exemption should be allowed. o Vikshara Trading Invest. P. Ltd. [2003 (157) ELT 4 (SC)] o ARCO Whitney Ltd. [2006 (193) ELT 217 (Tri.-Mumbai)] o Livinder Singh [2001 (137) ELT 1329 (Tri.-Del.)] o Jepika Paints [2010 (18) STR 380 (MP)] o Que Pharma Pvt. Ltd. 2013 (288) ELT 563 (Tri.-Ahmd.)] o Sony Enterprises [2018 (364) ELT 441 (Tri.-Mumbai)] o Laxmi Industries [2013 (298) ELT 435 (Tri.-Ahmd.)] o Raj Industries [2019 (370) ELT 287 (Tri.-Del.)] Accordingly he submits that the benefit of SSI exemption should be allowed to the appellant. He does not dispute that the goods classifiable under CH 8536 were to be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Act and/or Rule 25 of the Central Excise Rules, 2002 cannot be sustained and is liable to be set aside. Appellant is also not liable for the payment of interest, except to the extent the interest is leviable on the duty payable on Rs.13,16,653/-, under Section 11AA of the Act. Accordingly he prays that the appeal may be allowed in their favour to the extended indicated. 3.3 Learned AR reiterates the findings recorded by the Commissioner in the impugned order. 4.1 We have considered the impugned order along with the submissions made in appeal and during the course of arguments. 4.2 For confirming the demand, Commissioner has in the impugned order observed as follows:- 25. In the conspectus thereof, the basic issue, which arise for my consideration is whether, during the relevant period, the KALKI, a registered trademark under the Trademarks Act, 1999, belonged to the notice or their proprietor for the purpose of the notification number 2003-CE dated 01.03.2003. 26. The law in this regard has been stated in Meghraj Biscuit Industries Limited, 2007 (210) ELT 161 and restated in Meyer Health Care Private Limited 2011 (267) ELT 145. The apex court in Meyer H ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Mansukhlal Gosrani and Shri Chandrakant Gosar Gosrani as Karta of Chandrakant G Gosrani (HUF). This is at the Exhibit 11 to the show cause. Thereunder, Shri Mohanlal Gosar Gosrani and Shrimati Hemlata Mansukh Gosrani state at Para 3 that they have handed over all rights concerned to the above mentioned trade mark alongwith the goodwill of the said mark to Mr. Chandrakant Gosar Gosrani HUF vide agreement dated 30.09.2005 . 30. However, immediately succeeding thereto at Exhibit 12 is the notarized affidavit dated 11.05.2011, affirmed to by Shri Mohanlal Gosar Gosrani and Shrimati Hemlata Mansukhlal Gosrani, who have stated at clause 2 thereto that vide deed of assignment dated 6th day of May, 2011, we have assigned the said trade mark in favour of Mr. CHANDRAKANT GOSAR GOSRAN! (karta of Chandrakant Gosrani HUF) as a sole proprietor of Kalki Industries, and we have received our consideration thereof. 31. Also, as part of the exhibit L to their shown cause is the registered 'Dead of Assignment dated 06.05.2011 entered into between Shri Mohanlal Gosar Gosrani and Shrimati Hemlata Mansukhlal Gosrani as assignor of the first part and Shri Chandrakant Gosar Gosrani (karta of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted in the notification number 8/ 2003-CE dated 01.03.2003 these excisable goods ought to have been cleared by the noticee only on payment of the payable amounts of duty of excise. 36. Having failed to do so; the demands of these unpaid duties of excise, made in the notice, must find acceptance at my hand. 37. The noticee, in their shown cause, next submit that since the subject notice had been issued only on 06.05.2011; the demand for the period prior to May, 2010 in wholly time barred. This is because, the noticee had a bona fide belief that the brand KALKI had belonged to them. 38. This argument, though attractive, is a chimera. It is evident that the deed of assignment was signed only on 06.05.2011. If the noticee had a bona fide belief of having held the registered trade mark on and after 30.09.2005; there was no necessity for them to enter into a notarized and registered deed of assignment on 06.05.2011 and that too for a considered sum of 10,000/-. Did they not bonafidely believe that there was no necessity of entering into the Deed of Assignment dated 06.05.2011, when the assignment had already occurred under the dissolution agreement dated 30.09.2005 and the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... said trade mark in favour of Mr. CHANDRAKANT GOSAR GOSRANI (karta of Chandrakant Gosrani H.U.F.) as a sole proprietor of M/s. Kalki Industries, and we have received our consideration thereof. 3. That the said registered mark has been assigned along with the goodwill of the firm, and the assignee shall be free to use the trading style M/S. KALKI INDUSTRIES. 4. That we have signed Form TM-24 and have no objection if the same is allowed and the assignee's name is entered in the Register of Trade Marks as the subsequent proprietor of the Registered Trade Mark No. 622155 under Class 09 w.e.f. 1st October 2005 . 4.5 From the perusal of the above deeds, it is very clear that trade mark No. 622155 KALKI registered in the name of Shri Mohanlal Gosar Gosrani and Smt. Hemlata Gosrani has been assigned in the name of Shri Chandrakant Gosrani and this fact has been duly intimated in the affidavit filed before Registrar of Trade Marks, Mumbai. Affidavit of 11.05.2011 also refers to the earlier deed and says that it was assigned on 06.05.2011. Reliance by Commissioner on the affidavit of 2011 to deny the fact of assignment of the trade mark in the name of the appellant on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... manner as may be decided by the purchaser. As such, it is clear that entire assets of the running units along with trademark were purchased by the appellant. In such case it cannot be said that the same belongs to the seller. Use of the same will not disentitle the appellant from the benefit of small scale exemption of the notification. B . Vankatesh Yedidha [2016 (332) ELT 860 (Tri-Mum )] 7.1 After considering the submissions made by both sides and on perusal of the records, we find that as regards the issue No. 1 the entire arguments of the learned Consultant is Venky Co. is sole proprietorship firm while ICPL is a Private Limited Company hence, clearances cannot be clubbed as also for the reason that both the entities are geographically located at different places, while it is the findings of the adjudicating authority that Shri Venkatesh was sole proprietor of Venky Co. and held 90% shares of ICPL hence the clubbing of clearances needs to be done, we do not agree with the findings recorded by the adjudicating authority on this point. It is undisputed that Venky Co. is a sole proprietorship firm and ICPL is a Private Ltd. firm. C.B.E. C. vide Circular No. 6 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e will be no question of distributing the exemption. (iv) Whether or not in the expression by or on behalf of a manufacturer the expression from one or more factories is added, the effect would be the same if the manufacturer is also the same. The expression one or more factories only further clarifies that whether the factory is one or more, it is the clearances by or on behalf of the same manufacturer which is to be taken into consideration for purposes of interpreting the exemption notification . (emphasis supplied) 7.2 It can be seen from the above reproduced portion at point No. (ii), the Board has specifically stated and clarified that Limited Companies whether public or private are separate entities and partnership firm is separate entity than the Ltd. Company. In the case in hand, the Limited Co. being separate entity and distinct from share holders, it cannot be said that Shri Venkatesh having 90% of shares in ICPL by virtue of being proprietor of Venky Co., the clearances could be clubbed. In our view Revenue is arguing against their own circular which is incorrect. This view was taken by the Hon ble High Court of Madras in the case of Campion Plastic ..... X X X X Extracts X X X X X X X X Extracts X X X X
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