Small-scale exemption denied where goods bore another person's brand name; extended limitation rejected and duty recomputation remanded.

Small-scale exemption under Notification No. 88/88-C.E., as amended, was unavailable for detergent powder cleared under the brand name "Saving Plus" because the brand belonged to another person: Corona Plus was the registered owner or user and was also dealing in the brand for detergent powder, so the respondents could not claim ownership merely from having applied for registration. The extended period of limitation was not attracted because searches had already been conducted on intelligence and suppression was not established; the demand was therefore confined to the normal period. As exemption failed, duty liability arose, and the matter was remanded for computation of the duty payable.

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Issues: (i) Whether detergent powder manufactured by the respondents under the brand name "Saving Plus" was ineligible for exemption under Notification No. 88/88-C.E. as amended by Notification No. 35/97-C.E. because the brand name belonged to another person; (ii) Whether the extended period of limitation could be invoked for part of the demand; and (iii) whether the matter required computation of duty payable.

Issue (i): Whether detergent powder manufactured by the respondents under the brand name "Saving Plus" was ineligible for exemption under Notification No. 88/88-C.E. as amended by Notification No. 35/97-C.E. because the brand name belonged to another person.

Analysis: The amended exemption denied benefit to goods bearing the brand name or trade name of another person. The record showed that Corona Plus was the absolute owner or registered user of "Saving Plus" for detergent cakes and was also dealing in detergent powder under that brand name. Since Corona Plus was a non-manufacturing trader in relation to detergent powder, the respondents could not claim that the brand name belonged to them merely because they had applied for registration. The distinction drawn on the basis that Corona Plus manufactured detergent cakes, while the respondents manufactured detergent powder, did not assist the respondents in the facts of the case.

Conclusion: The respondents were not entitled to the benefit of Notification No. 88/88-C.E. in respect of the goods cleared under the brand name "Saving Plus".

Issue (ii): Whether the extended period of limitation could be invoked for part of the demand.

Analysis: The officers had already searched the respondents' and Corona Plus's premises on the basis of intelligence, and an enquiry was underway. In those circumstances, suppression of facts for the relevant period was not established on the record, although the normal period demands remained sustainable.

Conclusion: The extended period was not available on the facts found, and the demand was confined to the normal period for the relevant notice.

Issue (iii): Whether the matter required computation of duty payable.

Analysis: Since the exemption was held inadmissible, duty liability arose, but the precise amount had to be worked out by the Commissioner. The record did not establish the Revenue's allegation regarding continued association of the secretary with Corona Plus throughout the demand period.

Conclusion: The matter was remanded to the Commissioner for computation of the duty payable.

Final Conclusion: The exemption claim failed, the demand survived to the extent permissible in law, and fresh computation of duty was directed on remand.

Ratio Decidendi: For the purpose of small-scale exemption, goods bearing a brand name used by a non-manufacturing trader are treated as bearing the brand name of another person, and the exemption is unavailable notwithstanding that the manufacturer has applied for registration of that brand name.

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