Brand name use on excisable goods can defeat small scale exemption when markings indicate a trade connection with another entity.

Marking excisable goods with TSN/UTS stickers, together with the words and logo of Tele Shopping Network and United Teleshopping, was treated as use of another person's brand name because it indicated a trade connection with those entities. On that basis, the commentary states that the small scale exemption was unavailable even though the goods were not expressly said to be marketed by TSN/UTS. It also notes that the duty demand and company penalty were sustained, while the separate penalty on the Director was set aside for lack of an independent basis.

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Issues: (i) Whether the use of stickers bearing TSN/UTS on the goods manufactured by the assessee amounted to use of the brand name of another person so as to deny the benefit of the small scale exemption notification; (ii) Whether the penalty imposed on the company and the Director was sustainable.

Issue (i): Whether the use of stickers bearing TSN/UTS on the goods manufactured by the assessee amounted to use of the brand name of another person so as to deny the benefit of the small scale exemption notification.

Analysis: The exemption was unavailable to goods bearing the brand name or trade name of another person. The stickers used on the goods prominently carried TSN/UTS, along with the words and logo of Tele Shopping Network and United Teleshopping, and conveyed that the goods were specially packed for those entities. This indicated a connection in the course of trade between the goods and TSN/UTS. The absence of an express statement that the goods were being marketed by TSN/UTS did not alter the effect of the marking. The reliance placed on decisions involving different factual settings was rejected.

Conclusion: The use of TSN/UTS amounted to use of another person's brand name, and the assessee was not entitled to the small scale exemption.

Issue (ii): Whether the penalty imposed on the company and the Director was sustainable.

Analysis: Since the duty demand on the company was upheld, the penalty on the company was also sustained as reasonable in the facts of the case. However, no separate basis was found for imposing penalty on the Director independently of the company's liability.

Conclusion: The penalty on the company was upheld, while the penalty on the Director was set aside.

Final Conclusion: The demand of duty and the penalty on the company were sustained on the ground that the goods bore another person's brand name, but the separate penalty on the Director was annulled.

Ratio Decidendi: A marking on excisable goods that identifies or indicates a trade connection with another person constitutes use of that person's brand name for purposes of a small scale exemption notification, even if the exact trade name is not fully reproduced.

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