Customs, Excise and Gold Tribunal - Tamil Nadu
Collector Of Central Excise vs Technics India on 30 May, 1995
Equivalent citations: 1995ECR683(TRI.-CHENNAI), 1996(83)ELT411(TRI-CHENNAI)
ORDER V.P. Gulati, Member (T)
1. These appeals have been filed by the revenue against the orders of the Asstt. Collector of Central Excise, Guntur. Brief facts of the case are that the respondents M/s. Technics India had manufactured voltage stabilizers at the premises of M/s. Andhra Pradesh Electronics Dev. Coprn. Ltd. (APEDCL) on acceptance of their tender for the manufacture. Voltage stabilizers manufactured bore the brand name of M/s. Technics India, namely, 'autostab' and also the words 'APEL' were imprinted on the label affixed. Proceedings were drawn holding that inasmuch as the letters APEL could be considered as a brand name of M/s. APEDCL, the goods manufactured for M/s. Techincs India in terms of para 7 of Notification No. 175/86 would not be eligible for the benefit of small scale exemption. The submissions before the learned lower authority was that the stabilizers in fact bore only the brand name of M/s. Technics India and the letters APEL had been affixed to show that the voltage stabilizers manufactured by M/s. Techincs India were meant for APEL and in that view of the matter the letters APEL could not be considered a brand name as such and therefore, the stabilizers manufactured by M/s. Technics India would not be hit by para 7 of Notification No. 175/86. The learned lower authority in this regard has held as under :-
"Considering all the facts of the case as mentioned in the replies to the show cause memo issued to A.P. Electronics Dev. Corpn. Ltd. and M/s. Technics India, that the brand name 'autostab' is correctly put on their line voltage correctors and the word 'APEL' has been printed only to distinguish the goods as belonging to A.P. Electronics Development Corpn. Ltd. as mentioned above. Therefore, Technics India are eligible for the exemption available under Notification No. 175/86-C.E., dt. 1-3-1986. In conclusion, I hold that there is no case either against M/s. Andhra Pradesh Electronics Dev. Corpn. Ltd., Gan-navaram or Technics India. I, therefore, drop further proceedings in both the cases."
2. The learned DR adopting the reasonings given in the appeal memorandum has urged that in terms of Notification No. 175/86, if any goods manufactured by a small scale unit are affixed with the brand name of another person who is not the holder of SSI certificate, the goods manufactured would not be eligible to the benefit of Notification No. 175/86. He pleaded that inasmuch as the letters "APEL" have been affixed on the goods manufactured by Technics India these letters which indicate a connection between the goods and APEL can be considered as the brand name. In this connection, he has referred to the definition of the "brand name" as given in Explanation 8 of the Notification No. 175/86 dated 1-3-1986. He pleaded that this definition is very broad and so long as there are some invented word or writing which are used in relation to the goods which indicate a connection in the course of trade between the goods and the person using such name or mark the brand name of the other person can be said to have been used by the use of such words. He has pleaded that the writing "APEL" connects the goods with the A.P. Electronics Dev. Corpn. Ltd. who are engaged in the manufacture and supply of various goods and therefore, the learned lower authority was in error in holding that the use of the letters "APEL" could not be considered as a brand name in the context of Notification No. 175/86.
3. None appeared on behalf of the respondents.
4. We have gone through the order of the learned original authority which is in appeal before us and the pleas made by the learned DR on the grounds of appeal as urged before us. The short point that falls for consideration is whether imprinting the lables with the letters "APEL" on the goods manufactured by M/s. Technics India, who have also used their brand name 'autostab' could be considered to be a use of the brand name of the other person, namely, APEL in this case for the purpose of para 7 of the Notification No. 175/86. The said para for convenience of reference is reproduced below :-
"The exemption contained in this notification shall not apply to the specified goods where a manufacturer affixes the specified goods with a brand name or trade name (registered or not) of another person who is not eligible for the grant of exemption under this notification :
Provided that nothing contained in this paragraph shall be applicable in respect of the specified goods cleared for home consumption before the 1st day of October, 1987."
The definition of the brand name as given in the notification is also reproduced below for convenience of reference :-
"Brand Name" or "trade name" shall mean a brand name or trade name, whether registered or not, that is to say a name or a mark, such as symbol, monogram, label signature or invented word or writing which is used in relation to such specified goods for the purpose of indicating, or so as to indicate a connection in the course of trade between such specified goods and some person using such name or mark with or without any indication of the identity of that person."
5. It is observed that for the goods to be covered under the purview of para 7 of Notification No. 175/86, it must carry a brand name which could be taken to be as per the definition of brand name given above. This definition, it may be seen, is very broad and so long as it can be shown that any writing or invented word used in relation to any goods indicate the connection and the course of the trade between the goods and the person who used this name or mark. Such writing can be taken to be a brand name for the purpose of Notification No. 175/86. In the present case, the writing 'APEL" certainly as seen from the abbreviation "APEL". The plea as made by the respondents before the learned lower authority and which has been accepted by the said authority is that this was only to indicate that these goods manufactured by M/s. Technics India were intended for APEL. The same plea was also made by APEL who were also in pleaded as one of the parties and were called upon to explain as to why penalty should not be levied on them under Rule 209A. It may be seen that for any writing to be treated as a brand name or otherwise, a finding would be required to be entered whether such a writing is indicative of a connection between the person to whom this writing pertains to and the goods in the course of trade. This would mean that investigation would be required to be done to ascertain whether APEDCL have been manufacturing the goods or have been marketing the goods in the course of trade when "APEL" endorsed on the goods being sold by them. Before accepting the plea of the appellants, it was incumbent on the learned lower authority to have taken note of the broad description of the word "brand name" and should have ascertained from APEDCL as to the range of their manufacturing and trading activity and whether they have affixed "APEL" on their products while selling them. As it is, there is no legal requirement requiring M/s. Technics India to affix the name of the symbol of the buyer on the products manufactured by them as the requirement in respect of patent and proprietary medicines where the goods are manufactured on job work or a loan licencee basis. Prima facie it would appear that the words 'APEL' are in the nature of a writing or invented word show a connection of stabilizers with APEDCL in respect of the goods which were being put in the market stream as their own goods. We, therefore, hold that the learned lower authority has not examined the case in depth and has merely accepted the respondents assertion that the letters "APEL" had been printed on the labels of the voltage stabilizers to indicate that the goods manufacutred were meant for APEDCL. It is pertinent to note that M/s. Technics India had manufactured the goods in the premises of APEDCL as per the conditions of the tender and therefore, there was no need for them to indicate any additional letters "APEL" on the voltage stabilizers to avoid any mixing up of the goods which they might have been manufacturing on their account and for others if the manufacture was in their own premises. APEDCL appears to have deliberately got the letter as already affixed. APEDCL were the ones who were going to sell the goods as their own goods, and M/s. Technics India were only jobbers for APEDCL. In view of the above, we hold that the order of the learned lower authority is not proper and not maintainable in law and the same is therefore set aside and the matter is remanded to the learned lower authority for deciding the issue afresh in the light of our observations above after affording the respondents an opportunity of hearing.