SSI exemption and clandestine removal claims fail where brand assignment is proved and no corroborative evidence supports diversion.

SSI exemption could not be denied on the ground of another person's brand name where an assignment deed showed the brand had been assigned to the assessee; the mere absence of registration did not alter that position, and the exemption denial was unsustainable. A demand for clandestine removal based on parallel invoices also failed because the Revenue produced no positive or corroborative evidence of diversion or actual clandestine clearance, while the assessee's explanation of provisional supplies and later monthly reconciliation remained unrebutted. The connected confiscation, penalty and redemption fine also fell with the main demand, and the extended period was held unavailable in view of prior notice on the same issue.

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Issues: (i) Whether the assessee was disentitled to the benefit of SSI exemption on the ground that it used the brand name of another person; (ii) Whether the demand based on alleged clandestine clearances on the strength of parallel invoices was sustainable, along with the connected demand for penalty, confiscation and redemption fine.

Issue (i): Whether the assessee was disentitled to the benefit of SSI exemption on the ground that it used the brand name of another person.

Analysis: The goods were cleared under purchase orders referring to the brand name Neelco, and some goods bearing that name were found in the factory. However, the assessee produced an assignment deed showing entitlement to use the brand name. Once the brand stood assigned in fact, absence of registration did not change the legal position. The mere presence of some goods with the brand name, in the face of the assignment, did not justify denial of the exemption.

Conclusion: The assessee was entitled to SSI exemption and the denial of benefit on the brand-name ground was unsustainable.

Issue (ii): Whether the demand based on alleged clandestine clearances on the strength of parallel invoices was sustainable, along with the connected demand for penalty, confiscation and redemption fine.

Analysis: The purchase arrangement required monthly billing on a performance basis, and the assessee explained that provisional supplies were later reconciled through monthly invoices. The Revenue produced no positive or corroborative evidence showing diversion of goods or actual clandestine removal. In the absence of tangible evidence, the allegation of parallel invoices could not sustain a demand. The connected findings on confiscation, penalty and redemption fine also could not survive, and the extended period was held unavailable in the light of the prior notice on the same issue.

Conclusion: The demand on the clandestine removal allegation, together with the connected penalties and confiscation, was unsustainable.

Final Conclusion: The impugned orders were set aside and the appeals succeeded with consequential relief.

Ratio Decidendi: An SSI exemption cannot be denied where the brand name stands assigned to the assessee, and a charge of clandestine removal must fail unless supported by positive and corroborative evidence.

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