TaxTMI 
TaxTMI 
2001 (1) TMI 116
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....ing under Heading 84.48 of the Schedule to the Central Excise Tariff Act; that on 20-12-1976, they arrived at an agreement with M/s. Shah Engineering Works, having a small scale industrial unit registered with the concerned authorities on 27-10-1978 which was thereafter given a further certificate dated 15-4-1994; that under the said agreement, brand name 'Shah Trumpelt' originally belonging to Shah Engg. Works (SEW) was assigned to the Appellant on a payment of Rs. 400/- as royalty to the said SEW on the sale of each machine manufactured by the Appellants; that a further Indenture of Agreement dated 18-1-1979 was arrived at clarifying that until the completion of sale of units and payment of royalty, the said brand name would be in joint ownership and thereafter the said brand name would exclusively belong to the Appellants; that the last date fixed for completion of the production and sale of units was 30-6-1992 which was extended up to 30-6-1994. 2.2 The learned Advocates, further, mentioned that the Appellants were selling their products to M/s. LMS Marketing Pvt. Ltd., incorporated on 3-1-1979, a marketing company, on principal to principal basis; that "LMS" was not a brand....
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....t of unbranded goods; that inasmuch as in all 48 sales invoices which were seized and lying with the Department relating to Dobby Heads of M/s. LMS Marketing Pvt. Ltd., there was no existence of brand name "Shah Trumpelt". 4.The learned Advocate, further, stated that expression 'LMS' was treated to be brand name on the basis of statement dated 24-9-92 of Shri Nilesh R. Doshi without referring to other assertions of Shri Doshi in his further statement dated 25-9-92 wherein he clearly stated that "LMS" was not considered as brand name; that further as Shri Doshi was not at all concerned with M/s. LMS Marketing Pvt. Ltd., no importance of whatsoever nature could be attached to his statement dated 24-9-92 to the effect that "LMS" mark was owned by M/s. LMS Marketing Pvt. Ltd.; that in any case expression "LMS" was being used by M/s. LMS Foundries Pvt. Ltd., incorporated on 16-4-1974 i.e. much prior to M/s. LMS Marketing Pvt. Ltd. which was incorporated on 3-1-1979; that said Foundries Pvt. Ltd. had mentioned the expression "LMS" in an advertisement published in Times of India dated 17-5-1976 (Ahmedabad Edition) in respect of their products castings and cast iron articles. 5.Final....
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.... prior to that event cannot be one of ownership. The learned D.R. emphasised that if Appellant is a joint owner, the question of paying any royalty to M/s. SEW does not arise; that royalty is paid for use of some one's product; that even the second Agreement does not transfer the ownership to the Appellants. He relied upon the decision in the case of Kali Aerated Water Works v. UOI, 1995 (76) E.L.T. 265 (Mad.) wherein it was held that benefit of notification was not available as the petitioners were using the brand name with permission of the owner as per deed of mutual agreement. He also relied upon the decision of the Supreme Court in the case of M/s. Power Control Appliances v. Sumeet Machines Pvt. Ltd. (1994) 2 SCC 448. 7.The learned D.R. also mentioned that M/s. SEW were only doing trading activities; that nothing has been brought on record to show that M/s. SEW were having a factory manufacturing any goods; that mere possessing a certificate of registration as SSI is not sufficient to show that they are not traders; that no declaration as required under Central Excise Rules was filed by M/s. SEW; that it is necessary for availing the exemption under Notification No. 175/86....
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....e not disclosed to the Department; that they did not disclose that the brand name "Shah Trumpelt" was owned by M/s. SEW instead they declared that the brand name belonged to them; that their relationship with M/s. LMS Marketing Pvt. Ltd. was also suppressed by the Appellants. He relied upon the decision in the case of Sonoma Aromatics Pvt. Ltd. v. CCE, Bangalore, 1995 (78) E.L.T. 285 (T) wherein extended period was held to be invokable for demanding duty as the Assessee had suppressed the fact of using brand name, logo and colour scheme of a foreign company, and mentioned that this decision has been confirmed by the Supreme Court as reported in 1997 (93) E.L.T. A70. 8.In reply, the learned Advocate mentioned that in Calcutta Chromotype case, supra, the matter was remanded by the Supreme Court with categorical assertion that no mutuality of interest was found by the Department; that the Department has not brought any evidence on record to show mutuality of interest; that Mr. Doshi himself had deposed in his statement that they had never considered "LMS" as a brand name; that in any case how a company coming into existence at a later stage can have the brand name "LMS"; that Shri ....
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.... The burden is cast upon the Department to prove that an assessee is affixing the central excise goods manufactured by him with a brand name of another person who is not eligible for the benefit of the exemption under the Notification. In the impugned Order it has been mentioned that as the allegation was made on the basis of evidence tendered by the responsible person of the Appellants the onus was cast on them and not on the Department. We find ourselves unable to agree with this reasoning. If at all there was any onus on the Appellants, they have discharged the same by presenting the certificate of registration as SSI unit for manufacture of textile machinery parts. The burden has again shifted to the Department to prove that Shah Engg. Works were not manufacturing the products and they were only engaged in trading. This burden has not been discharged by the Department. In view of this, without going into the question, whether the Appellants were joint owner of the brand name "Shah Trumpelt", we hold that mischief of Para 7 of the Notification is not attracted as far as affixing the brand name "Shah Trumpelt" is concerned. 10.Regarding the use of brand name "LMS" we find that....