Trade mark registration date controls excise exemption for readymade garments; later retrospective registration does not cure prior clearances.

Excise duty exemption for readymade garments depended on whether the goods were sold under a registered trade mark on the date of clearance. A later grant of trade mark registration with retrospective effect did not change the legal position as it stood at the time of clearance, and the mere pendency of the application was insufficient to deny the exemption. On that basis, the excise duty demand was held unsustainable against the assessee.

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Issues: Whether excise duty could be levied on clearances of readymade garments made during the pendency of a trade mark application, when registration was granted later with retrospective effect.

Analysis: The duty exemption turned on the goods being sold under a registered trade mark on the date of clearance. The subsequent grant of registration with retrospective effect did not alter the legal position as on the clearance dates. Mere pendency of the trade mark application was insufficient to treat the goods as sold under a registered trade mark for the purpose of denying exemption.

Conclusion: The demand of excise duty was not sustainable against the assessee.

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