Customs, Excise and Gold Tribunal - Bangalore
Commissioner Of Central Excise vs Mamma Products on 22 June, 2004
Equivalent citations: 2004(172)ELT192(TRI-BANG)
ORDER S.L. Peeran, Member (J)
1. The Revenue is aggrieved with the Order-in-Appeal No. 422/2002-C.E., dated 14-6-2002 by which he has held in Paras 5 and 6 as follows :-
"5. I have carefully examined the records of the case, the documents enclosed and the submission made during the personal hearing. The short point for determination in this proceedings is whether the appellant used the brand name of another person or the brand name is their own. The adjudicating authority found that the two units viz., M/s. Mamma Products and M/s. Manna Products are different partnership firms having nothing in common except a few partners. While arriving at a conclusion for denying the benefit of SSI exemption Notifications the adjudicating authority found that M/s. Manna Products are also using the brand name 'summer treat' and M/s. Mamma Products have failed to prove that the brand name is not owned by M/s. Manna Products. This conclusion obviously traverses the settled dictum of law that the person who raise the allegation has to prove the same. In the instant case the department ought to have proven that the brand name is actually owned by M/s. Manna Products and M/s. Mamma Products and M/s. Manna Products are separate legal entities. It is noticed that the appellants have stated that they have two firms only for the convenience of distribution and also for the sake of separate accounting for Sales Tax and Income Tax purpose. The investigating officers have failed to establish that both units are separate legal entities for the purpose of Sales Tax assessment and Income Tax assessment. On a perusal of the copy of the agreement submitted by the appellant, it is seen that the appellants had acquired the right for using the brand name 'summer treat' along with M/s. Manna Products. Further, M/s. Manna Products have not objected to their brand name being used by the appellants. Ministry as per Circular No. 52/52/94-CX., dated 1-9-94 (F. No. 40/12/94-TRU) has clarified that units, which are using trade name or brand name, which does not belong to any person, are eligible for exemption. In the circumstances, the department would have a case only when the aggregate value of sales of both the units together exceeds the SSI exemption limit. In other words the appellant are eligible for the benefit of exemption under Notfn. No. 8/98 and 8/99 subject to the condition of clubbing of the value of clearance of the both units exceeds the exemption limit. In the circumstances, I hold that the demand is unsustainable and the Order-in-Original is liable to set aside.
06. In view of the above I pass the following ;
ORDER I. The appellants were eligible for the benefit of the exemption Notfns. No. 8/98, dated 2-6-98 and 8/99, dated 28-2-99.
II. The Order-in-Original is not legal and proper and hence annulled."
2. Ld. SDR arguing for the Revenue submitted that the assessee is not entitled to the benefit of the exemption Notfn. No. 8/98 (subsequently 8/99) as in his statement dated 17-12-98, Shri Shajimon Joseph, one of the partners of the assessee company had admitted that they were using the brand name 'summer treat' from 1998. It is stated that they were aware of the fact that another firm M/s. Manna Products were using the same brand name right from 1996 for identical products. Therefore, the benefit of the Notification cannot be extended. In this regard he relied on the judgment of the Madras High Court rendered in the case of Bell Products Company v. Union of India [1995 (78) E.L.T. 404 (Mad.)] wherein the benefit of SSI exemption has not been extended on account of the brand name of 'Bell' was used in respect of different products of another person viz., one of the partners of company. He further relied on the judgment rendered by the Apex Court in the case of CCE, Chandigarh v. Mahaan Dairies [2004 (166) E.L.T. 23 (S.C.)] wherein the registered trade name of another company namely 'Mahaan' was printed on pickle packs sold by the respondents with additional words 'taste maker'. He also relied on the judgment rendered in the case of CCE, Trichy v. Rukmani Pakkwell Traders [2004 (165) E.L.T. 481 (S.C.)] wherein the Apex Court has held that benefit of Notfn. No. 1/93-C.E. in terms of its Explanation IX to Notfn. No. 1/93-CE is not available without the brand name when use of even part of brand name of another person indicating a connection in course of trade would be sufficient to disentitle a claim for exemption.
3. Ld. Counsel submitted that he had no quarrel with the ratio laid down by the judgment cited by the ld. SDR but his submission is that the ratio of these judgments would not apply to the facts of the present case. It is his submission that the brand name 'summer treat' was jointly owned by the respondents and M/s. Manna Products by an agreement and they had a separate territorial jurisdiction for marketing the ice cream with the common brand name held by them. He pointed out that in the citations referred to by the Id. SDR the question was not of a common ownership of the brand name used by two persons but the brand name was owned by another independent person and it was used by the SSI Unit and hence the benefit was denied. He relied on the judgment by the Tribunal in the case of Elex Industries v. CCE, Chandigarh [2003 (158) E.L.T. 602] wherein the use of brand name by co-owners has been held to be eligible for the benefit of notification. He also relied on the judgment rendered in the case of Elex Knitting Machinery Co. v. CCE, Chandigarh [2003 (158) E.L.T. 499] wherein also the brand name was used by two co-owners and it was held to be eligible for the benefit of notification. He again relied on the judgment rendered in the case of CCE, Cochin v. Geo Engineering Works [2004 (165) E.L.T. 463] wherein also it has been held that it cannot be assumed that the impugned brand name used by assessee belonged to another person, statutory certificate of ownership of brand name of person, who was alleged to be owner thereof, was not produced by the Revenue. On this premise the President's Bench held that the benefit of exemption cannot be denied. Ld. Counsel submits that the Revenue has not produced any evidence to substantiate their claim to deny the benefit of Notification and he submits that in view of the citations produced by him the appeal is required to be rejected.
4. On a careful consideration of the submissions and on perusal of the agreement dated 7-1-97 entered into by the assessee with M/s. Manna Products it is seen that they are the joint owners of 'summer treat' and the agreement clearly bifurcates their individual areas of operation for marketing the products by executing appropriate agreements as and when required as laid down in Clause 5 of the agreement. By agreement dated 31-12-96 M/s. Manna Products had purchased the brand name 'summer treat' from its owners who were using it in the name and style of M/s. Milk Food Products. In view of this evidence produced, it is very clear that the brand name is jointly used by both the parties namely M/s. Manna Products and M/s. Mamma Products. Ld. Counsel also relied on the judgment of the Apex Court rendered in the case of CCE, Ahmedabad v. Vikshara Trading & Investment P. Ltd. [2003 (157) E.L.T. 4 (S.C.)] wherein the Revenue appeal was rejected and upheld the Tribunal's finding wherein it was held that the trade name need not necessarily be in respect of all goods unless registration has been so required and it has been further held that its permissible in law to have same brand name for having different class of goods owned by different persons and held that the Notfn. No. 223/87-C.E. was applicable. The Tribunal in the case of Elex Knitting Machinery Co. (supra) has clearly held that when the brand name is used by co-owners then the benefit of Notfn. No. 1/93-C.E. cannot be denied. The Bench in the case of CCE, Cochin v. Geo Engineering Works (supra) also has held that the Revenue should discharge their burden that the brand name did not belong to the assessee and was owned by another person. Since there was a common ownership of 'summer treat', therefore, it cannot be said that it was owned by another person. The judgment relied by SDR in the case of Bell Products (supra) and that of Apex Court judgment rendered in the case of Rukmani Pakkwell Traders (supra) and Mahaan Dairies (supra) is clearly distinguishable, as the trade name was owned by a different person who was the owner of the trade name. In the present case as noticed the trade names are jointly held by both the persons and they are trading and manufacturing in different territories and hence in the light of the judgments cited by the Id. Counsel the Order passed by the Commissioner (Appeals) is just and proper and the same is upheld. There is no merit in the Revenue appeal and the same is rejected.