2018 (3) TMI 164 - AT - Central Excise

Tribunal Upholds SSI Exemption for M/s Meyer Health Care

The Tribunal allowed the appeals filed by the appellants and dismissed the Department's appeal, maintaining the decision in favor of M/s Meyer Health Care ... SSI Exemption - assignment of brand name - date of assignment of Brand Name - Held that: - it is settled position of law that once the brand name has been assigned in favor of a person, he will be entitled to clear goods bearing that brand name considering it as his own and will be entitled to the benefit of the SSI Notification - It is not being disputed that the agreement dated 06.10.1998 has granted such assignment but the demand raised is for the period prior to this date i.e. January to September 1998. Upon perusal of the Assignment Agreement dated 06.10.1998, it is seen that in this Agreement there is a reference to the earlier agreement dated 25.08.1997. Further on perusal of a copy of the earlier assignment deed which is on record, we note that the same brand name stands assigned right from 25.08.1997 in favour of M/s Meyer Health Care Pvt. Ltd. Such being the case M/s. Meyer Health Care Pvt. Ltd. will be entitled to the SSI exemption during the disputed period. There is no dispute for the period subsequent to the assignment agreement, M/s Meyer Health Care will be entitled to the SSI benefit - appeal dismissed - decided against Revenue. Issues:Disputed period of January to September 1998, Brand name assignment, SSI exemption eligibility, Assignment Agreement validity, Use of brand name, Department's demand for duty, Appeal against Order-in-Original, Tribunal's Final Order, Supreme Court's directions.Analysis:The case involved three appeals concerning the disputed period of January to September 1998, following a Supreme Court order in a related case. The dispute centered around the brand name 'Fevril' assigned by M/s Meyer Organics Ltd. to M/s Meyer Health Care Pvt. Ltd. The Department contended that the brand name assignment was effective only from 06.10.1998, leading to a demand for duty for the period prior to this date. The Order-in-Original No.13/99 dated 05.11.1999 imposed penalties on M/s Meyer Health Care, which was later challenged and decided in favor of the appellant by the Tribunal in Final Order No.1492-1994/2002 dated 22.11.2002.The Supreme Court remanded the matter back to the Tribunal for a fresh decision, emphasizing the need to determine the validity and timing of the Assignment Deed. The appellant argued that the brand name assignment existed since 25.08.1997, granting them the right to the SSI exemption. The Department, however, raised concerns regarding the use of a monogram belonging to another entity, which they believed invalidated the SSI benefit claim.After considering the arguments, the Tribunal referred to legal precedents, including the Otto Bilz case, establishing that once a brand name is assigned, the assignee is entitled to the SSI benefit. The Tribunal found that the brand name 'Fevril' was indeed assigned to M/s Meyer Health Care from 25.08.1997, making them eligible for the SSI exemption during the disputed period. Consequently, the impugned order demanding duty was not justified.Regarding the Department's appeal for the subsequent period, the Tribunal upheld the Commissioner (Appeals)'s decision to extend the SSI exemption benefit based on the earlier Tribunal's order. The Tribunal concluded that M/s Meyer Health Care would be entitled to the SSI benefit post the assignment agreement date, and thus dismissed the Department's appeal.In conclusion, the Tribunal allowed the appeals filed by the appellants and dismissed the Department's appeal, maintaining the decision in favor of M/s Meyer Health Care Pvt. Ltd. The judgment was delivered on 11/12/2017.