2006 (6) TMI 35 - AT - Central Excise

Tribunal denies SSI Exemption for brand name misuse, upholds goods confiscation.

The Tribunal denied the appellant the benefit of SSI Exemption due to the unauthorized use of registered brand names. Allegations of clandestine removal ... Central Excise – Aerated waters–Goods cleared with brand name registered in the name of another person, not eligible to exemption–MRP values shown on sticker on crown cork cannot be basis for revision of price in absence of collection of money more than MRP–Confiscation and penalty upheld on basis of goods ready for dispatch not entered in RG1 Issues involved:1. Benefit of SSI Exemption Notification denial.2. Allegations of clandestine removal of goods.3. Valuation based on Section 4A.4. Confiscation of goods due to non-entry in the RG1 Register.Issue 1: Benefit of SSI Exemption Notification denialThe appellant, a proprietary unit manufacturing aerated waters, was alleged to have used brand names registered by another company, rendering them ineligible for SSI Exemption. The contention was that they were not the users of the brand names. However, citing the Apex Court judgment in CCE Vs. Grasim Industries Ltd., it was held that using another's trade name disqualifies the assessee from SSI Exemption. The Tribunal upheld this decision, denying the appellant the benefit of the SSI Exemption.Issue 2: Allegations of clandestine removal of goodsRegarding the allegation of clandestine removal based on shortages of crown corks, the appellant argued lack of evidence to support the claim. The defense highlighted the absence of proof of clandestine clearances, purchases, or money flow. The Tribunal noted the lack of collaborative evidence in favor of Revenue and the absence of admissions of clandestine clearances. Relying on established judgments, the Tribunal set aside the demands raised on the grounds of clandestine removal.Issue 3: Valuation based on Section 4AThe appellant contested the applicability of Section 4A concerning the revision of prices based on affixed stickers. Citing precedents like Hindustan Appliances and Accra Pac (India) Pvt. Ltd., the appellant argued against the revision of value solely on sticker prices. The Tribunal agreed with the appellant, setting aside the revision of value based on MRP stickers under Section 4A.Issue 4: Confiscation of goods due to non-entry in the RG1 RegisterThe appellant argued that the non-entry of goods in the RG1 Register, despite being ready for dispatch, should not lead to confiscation and penalties. However, the Revenue defended the confiscation, asserting that non-entry was an offense justifying confiscation and penalties. The Tribunal sided with the Revenue, affirming the confiscation and imposition of fines and penalties for goods not entered in the RG1 Register.In conclusion, the Tribunal modified the impugned order by denying the SSI Exemption, setting aside demands based on shortages and allegations of clandestine removal, rejecting the valuation under Section 4A, and affirming the confiscation of goods due to non-entry in the RG1 Register. The matter was remanded to the Original Authority for duty re-computation and penalty assessment based on the Tribunal's order. The appeal was dismissed, and the operative portion of the order was pronounced in open court.