2016 (11) TMI 183 - AT - Central Excise

Tribunal grants SSI exemption based on brand name assignment.

The Tribunal set aside the Order-in-Original and allowed the appeal in favor of the appellant. The Tribunal held that the appellant was entitled to the ... SSI exemption - use of brand name of others - assigned brand name - Notification No. 8/99 dated 01.03.1999 - Differential duty - Held that: - the adjudicating authority has not considered the issue in its correct perspective, inasmuch as once a deed is executed in respect of assigning of the trade names and brand name to the appellant then said brand name have to be held as to be used only by the appellant for the period in question as the agreement transfers all the rights on such brand name and trade name to the appellant - While the assignment deed dated 24-6-99, the erstwhile owner who happens to be the assignor have agreed to assign and transfer to the assesses before us, the trade mark Bullworker and have also agreed to do all acts necessary to register the same in favour of and in the name of the assignees the appellant before us with the Registrar of Trade Marks, Mumbai. Section 37 clearly enables the owner of a registered trade mark can assign and transmit whether with or without the goodwill concerned in respect of either of all the goods in respect of which the trade mark is registered or of some only of those good - Appeal allowed. Issues:Benefit of SSI exemption regarding goods branded with another person's name.Analysis:The appeal was against Order-in-Original No. 20/C.Ex/2004 dated 30.12.2004. The issue at hand was the eligibility of the appellant for SSI exemption concerning goods branded with another person's name. The appellant manufactured products under their brand name and also some medicaments under the brand name of M/s Starcase Pharmaceuticals. The Revenue contended that the appellant was not entitled to the benefit of Notification No. 8/99 dated 01.03.1999 for goods branded with another person's name. The adjudicating authority concluded that the appellant should pay differential duty as there was no evidence that the brand name assigned to the appellant was not being used by M/s Starcase Pharmaceuticals. The Revenue relied on a Supreme Court decision to support their stance.Upon review, the Tribunal found that the adjudicating authority had not considered the issue correctly. The Tribunal noted that once an agreement was executed assigning the trade names and brand name to the appellant, the brand name should be deemed to be used only by the appellant during the specified period. The Tribunal cited a previous case where a similar assignment deed established a connection between the product and the user of the trade mark, affirming the assignee's exclusive rights. The Tribunal disagreed with the Commissioner (Appeals) who opined that the brand name would still be perceived as owned by the original company, thereby denying the benefit of the notification to the appellant. The Tribunal highlighted the provisions of the Trade and Merchandise Marks Act, 1958, emphasizing the assignability of trade marks with or without goodwill.Based on the above analysis, the Tribunal held that the impugned order was unsustainable and set it aside, allowing the appeal in favor of the appellant. The decision was made in consideration of the legal provisions and the exclusive rights transferred to the appellant through the assignment deed, establishing their entitlement to the SSI exemption for goods manufactured and sold under the assigned brand name.