Valid trade mark assignment preserves Small Scale Industry exemption where the assessee uses the brand as its own.

A valid assignment of the brand name 'Fevril' meant the assessee used the mark in its own right and not as another person's trade mark. The dispute turned on the effective date of assignment, because the later deed of 06.10.1998 referred back to an earlier deed dated 25.08.1997, which established transfer from the prior date. On that basis, the conditions for denying Small Scale Industry exemption were not met for January to September 1998, and the same reasoning applied to the later period covered by the departmental challenge. The stated principle is that once a trade mark is validly assigned, exemption linked to use of another's brand name cannot be denied on that ground.

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Issues: Whether the assessee was entitled to Small Scale Industry exemption for the disputed period on the basis of assignment of the brand name "Fevril", and whether the subsequent departmental appeal could survive once the assignment in favour of the assessee was accepted.

Analysis: The brand name "Fevril" was found to have been assigned in favour of the assessee, and the dispute turned only on the date from which the assignment operated. The record showed that the later deed of 06.10.1998 referred to an earlier assignment deed dated 25.08.1997, and the earlier deed itself established assignment from that prior date. Once the brand name stood assigned, the assessee used it in its own right and could not be treated as using the trade mark of another person. On that basis, the conditions for denial of the exemption were not satisfied for the period January to September 1998. The same reasoning also governed the later period covered by the departmental appeal.

Conclusion: The assessee was entitled to the Small Scale Industry exemption for the disputed period, and the departmental challenge to the extension of the same benefit for the subsequent period was not sustainable.

Final Conclusion: The assessee succeeded on the core question of entitlement to exemption based on prior assignment of the trade mark, and the departmental appeal was rejected.

Ratio Decidendi: Once a trade mark is validly assigned to the assessee, the assessee uses it as its own brand name and is entitled to the corresponding exemption, including for the period covered by the effective assignment.

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