Custom, Excise & Service Tax Tribunal
Commissioner Of Central Excise vs Jaimin Enterprises on 1 September, 2016
IN THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL, WEST ZONAL BENCH AT MUMBAI
COURT No. I
Appeal No. E/3949/05
E/CO/131/06
(Arising out of Order-in-Appeal No. BR/138/M-IV/2005 dated 22.09.2005 passed by Commissioner of Central Excise (Appeals), Mumbai IV)
For approval and signature:
Honble Mr. M.V. Ravindran, Member (Judicial)
Honble Mr. C.J. Mathew, Member (Technical)
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1. Whether Press Reporters may be allowed to see : No the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?
2. Whether it should be released under Rule 27 of the : No CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?
3. Whether Their Lordships wish to see the fair copy : Seen of the Order?
4. Whether Order is to be circulated to the Departmental : Yes authorities?
Commissioner of Central Excise Mumbai IV Appellant Vs. Jaimin Enterprises Respondent Appearance:
Shri Ashutosh Nath, Asst. Commr (AR) for appellant None for respondent CORAM:
Honble Mr. M.V. Ravindran, Member (Judicial) Honble Mr. C.J. Mathew, Member (Technical) Date of Hearing: 01.09.2016 Date of Decision: ...2016 ORDER NO Per: M.V. Ravindran This appeal is filed by Revenue against the order-in-appeal No. BR/138/M-IV/2005 dated 22.09.2005.
2. None appeared for the respondent. Heard learned D.R. and perused the records.
3. In the case in hand the issue that falls for consideration is whether the respondent has incorrectly availed the benefit of Notification 8/2001 dated 01.03.2001 as amended by Notification 23/2001 dated 30.04.2001 ais applicable to SSI unit. It was the case of the Revenue before the adjudicating authority that appellant had cleared readymade garments falling under Chapter Heading 62.01 of Central Excise Tariff Act, 1985 having a brand name Nutty Boys. The adjudicating authority came to a conclusion that readymade garments under brand name are liable to duty as they had manufactured and cleared the garments with brand name belong to another person. Coming to such conclusion adjudicating authority confirmed the demand raised with interest and also imposed penalties. The first appellate authority by impugned order set aside the order on the ground that the product with the brand name Nutty Boys is not of the appellants has not proved beyond doubt by the department.
4. On perusal of the Grounds of Appeal, we find that the main grounds raised by the Revenue is that the applications filed by the appellant for the registration of the said brand name was pending on the date of issuance of show-cause notice and undisputedly the brand name did not belong to appellant. We find that the first appellate authority is correct in allowing the appeal inasmuch the findings of the first appellate authority are very relevant which has not been controverted by the department by leading evidence which is contrary to the findings recorded which we reproduce:-
04. I have carefully gone through the appeal memo, oral/written submission made by appellants as well as by department. I have also gone through the provisions of law relating to subject matter. The question for determination is whether the appellant is entitled for small scale exemption under the relevant notification, if brand name of another person is affixed on the similar goods manufactured by them. The SSI exemption is not available only if the' brand name or trade name is of another person. Thus. if the brand name or trade name does not belong to any another person, the SSI exemption will be available to the manufacturer. It is not requirement that the brand name must belong to the S51 manufacturer. The only requirement is that it should not be of another person. In the case of CCE Vs. M/s. Bhalla Enterprises [2004 (173) EL T 225 (SC)]: it has been held that object of notification is to grant benefit of those industries do not have the advantage of a brand name. The object 'of exemption notification is neither to protect 'the owners of trade mark I trade name, nor the, consumers from being misled. These are considerations which are relevant in cases relating to. disputes arising out of infringement I passing off under the Trade Marks Act. In the instant case. the facts reveals that though M/S. Zeal Apparel has initially applied for registration of the subject brand name but subsequently they have withdrawn and disowned ' w.e.f.19/ 20~03.01, through their disclaimer certificate and duly submitted before 'Trade Mark Registry. This fact is also . not disputed by Department. Thus, the said Trade mark is not claimed by other 'than appellant atleast from 19 / 20.03.01 onwards. The show cause notice covers the period after March. 200I onwards. In the other words during the disputed period the' said brand name is not owned by M/s. Zeal Apparel. Since show cause notice is not related to period prior to March 2001 so ; the use / ownership of said brand name prior to March 2001 has no bearing on the instant case. There is no bar that disowned brand name cannot be used for ever by anybody else. The SSI exemption is not available only if brand name is owned by other. In the case of MIs. Opus India Vs. CCE [l992 (62) ELT 447 (CEOAT)] it was' held that 'of means' owned by', - followed in the case of M/s. Meghraj Biscuits Vs. CCE [2001 (135) ELT 607 (CEGAT)]. Thus. if brand name is not owned by anyone, the SSI unit manufacturing goods under such brand name should be able to avail SSI concession. This view is held in the case of M/s Indal Brothers Vs. CCE [2002 (51) RLT 514 (CEGAT). ln the case of MIs. Jindal Brothers Vs. CCE [2002 (146) EL T 65 (CEGAT)], it was held that if no one is claiming ownership of brand name, it does not belong to anyone. In such case, the SSI unit will be eligible for exemption. In the instant case M/s. Zeal Apparel has disowned the said brand name and not used the subject brand name for their goods atleast during disputed period as there is no contrary evidence. In the case of CCE Vs. Mis. Hem Paints [2001 (129) ELT 129 (CEGAT). the appellant was using the brand name 'JK' which was also used by another person, who had stopped using it. It was held that mere 'use' by another person is not enough. If no one has ownership of brand name, it is in public domain and anyone is free to use it. In such case, the appellant is entitled to SSI exemption. The ratio of the aforesaid orders is squarely applicable in the instant case, in view of above facts. There are two conditions to indicate connection with the branded goods and (b) such connection should be in course of trade. If there is no 'trade' of such goods the brand name provisions will not apply. There is no evidence that M/s. Zeal Apparel has used the said brand name for the similar goods after they have disowned the same. I'n the case of M/s P& B Pharmaceuticals Vs. CCE [153 EL T 14 (SC)) it was held by Hon'ble Supreme Court that there is no obligation on owner of a logo to make roving enquiry to ascertain whether any other person is using his logo and then disclose it to department. to avert a possible allegation of suppression of facts. In the instant case the Department failed to produce any evidence 'that said .brand name is used in the :trade" by, M/s. Zeal Apparels during disputed period: hence burden of proof has not been discharged by department. It is also alleged that the wife of Shri Z.D. Haria has. used the brand name. This cannot itself leads to any violation on the ground of related person, because the Notification No. 8/2001 dated 01.03.2001 has no debaring prevision on the concept of related 'person. In the case of MIs. Elex Industries Vs. CCE [2'06~(158)~I/t7602(CESTAT)] brand name 'Flex,' belonged to partnership firm. One of the partners had another proprietary firm, where he was alleged to have manufactured goods under brand name 'Elex '. It was held that he is co-owner of the brand and hence it cannot be said that he has used brand name of another person in the manufacture and clearance of the goods by him in his individual capacity. Hence, he is eligible for SSI concession. The ratio of decision is squarely applicable in instant case in view of forgoing facts. The 'cases relied by appellants also support the aforesaid views. In view of above facts the basic' issue i.e. denial of SSI benefit is not sustainable.. Therefore, there is no need to go through the other aspect of the case such as valuation on MRP base ; calculation error ; duty-cum-price; deduction of exported goods limitation etc. In the result the appeal. succeeds on merits and order-in-original. is not sustainable.
4.1 We find that in the above reproduced paragraphs, the first appellate authority correctly summarised the factual position and hence we do not find any reason to interfere in such a reasoned order.
5. The impugned order is upheld and the appeal is rejected. Cross Objection filed by the respondent is also disposed of.
(Order pronounced in Court on.) (C.J. Mathew) Member (Technical) (M.V. Ravindran) Member (Judicial) nsk 1 6 Appeal No. E/3949/05 E/CO/131/06