Retraction and lack of corroboration defeat brand-name allegation in SSI exemption dispute under excise law.

SSI exemption under Notification No. 1/93-C.E. could not be denied merely on the basis of a proprietor's retracted statement that the goods bore another person's brand name. In the absence of independent oral or documentary corroboration, the retracted statement did not constitute substantive evidence to prove misuse of a third party's brand. Buyer certificates stated that the machines supplied did not bear the alleged brand name, and the authorities did not disprove those certificates or examine any buyer. On that material, the duty demand and penalties could not be sustained.

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Issues: Whether the benefit of the small scale industry exemption under Notification No. 1/93-C.E. dated 28-2-93 could be denied on the basis that the goods were cleared under a brand name belonging to another person, and whether the retracted statement of the proprietor, without independent corroboration, was sufficient to sustain the duty demand and penalties.

Analysis: The denial of exemption rested essentially on the proprietor's earlier statement that the machines bore the brand name "ELEX" belonging to another concern. That statement was subsequently retracted. The record contained no independent oral or documentary evidence corroborating the alleged use of another person's brand name. On the contrary, certificates from several buyers stated that the machines supplied by the assessee did not bear the brand name "ELEX", and one certificate referred to the label "EKM". The authorities had not shown that these certificates were false, nor was any buyer examined. In these circumstances, the retracted statement could not be treated as substantive evidence to displace the documentary material.

Conclusion: The exemption could not be denied on the basis of the uncorroborated retracted statement, and the duty demand and penalties were not sustainable on that ground.

Final Conclusion: The order denying SSI exemption was set aside and the appeal was allowed with consequential relief.

Ratio Decidendi: A retracted confessional statement, without independent corroboration, is insufficient to prove misuse of another person's brand name for the purpose of denying SSI exemption.

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