TaxTMI 
TaxTMI 
2026 (3) TMI 1616
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....., (GSTIN 33AADCN9472H2Z8), 16-A, Court Road, Johnsonpet, Post Box No. 725, Salem-630 007 are hereby required to show cause to the Joint/ Additional Commissioner of GST & Central Excise, No. 1. Foulkes Compound, Anai Road, Salem-636001 within 30 days from the date of receipt of this notice, as to why: i. the GST amount of Rs. 12,65,31,070/- (IGST Rs. 1,76,89,478/-, COST Rs. 5.44.20,796/ SGST- Rs. 5,44,20,796/-) (Rupees twelve crore sixty five lakhs thirty one thousand and seventy Only) being supply of their "Registered Brand" goods under the guise of "Unbranded" goods for the period from 01.07.2017 to 31.07.2022 should not be demanded from them under Section 74(1) of the CGST Act. 2017/TNGST Act, 2017 made applicable to IGST vide Section 20 of the IGST Act, 2017: ii. the appropriate Interest as per Section 50(1) of the CGST Act, 2017/TNGST Act, 2017 made applicable to IGST vide Section 20 of the IGST Act, 2017 on the GST amount demanded at Sl.No. (i) above, should not be demanded from them under Section 74(1) of CGST Act, 2017 /TNGST Act, 2017 made applicable to IGST vide Section 20 of IGST Act, 2017; iii. a penalty should not be imposed on them under Sec....
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....s Details of Taxable and Non-Taxable for the period from 01.07.2017 to 31.03.2022 by M/s Narasu's Saarathy Enterprises Private Limited, Salem. iv. Letter dated 19.08.2022 furnishing certain information regarding sale of branded as unbranded by M/s Narasu's Saarathy Enterprises Private Limited, Salem. v. Letter dated 03.06.2022 submission of Copy of ST GST affidavit by M/s Narasu's Saarathy Enterprises Private Limited, Salem. vi. Letter dated 22.02.2023 furnishing of GST Certain documents /information of branded, exempted and unbranded goods sold during the period April-2022 to July-2022 by M/s Narasu's Saarathy Enterprises Private Limited, Salem. vii. GSTR-3B Returns filed by the Taxpayer for the impugned period. viii. GSTR-9 Annual Returns filed by the Taxpayer for the impugned period." 3. Operative portion of the impugned order dated 30.01.2025 confirming the demand proposed in the aforesaid Show Cause Notice in Form GST DRC-01 dated 01.08.2024 against the petitioner is reproduced below:- "20. Accordingly, in view of the above discussion and findings I pass the following order: - a. I demand the GST....
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.... the branded packing materials are similar to the unbranded packing materials. The colour and font printed in the packing material of the branded goods are similar to the unbranded packing materials. The Batch Numbers are printed in unbranded packing materials as ULA, PWR, WHE, BUD, PLAIN, VET, YES, VPA, PWB, PWR which are similar to the branded packing materials "NARASU'S ULAASH", "NARASU'S POWER", "NARASU'S WHEEL", "NARASU'S BUDGET", "NARASU'S VETRY", "NARASU'S 'S'", "NARASU'S VPA", "NARASU'S POWER BLUE", "NARASU'S POWER RED", respectively. These abbreviations ULA, PWR, WHE, BUD, PLAIN, VET, YES, VPA, PWB, PWRare not only Batch Numbers but used for marketing their products in the abovementioned brand names. Normally the Batch Numbers are not permanently printed in the packing materials but are affixed after/during packing of products only. 5.4 In some of the unbranded goods they use a part of registered Brand symbol/names viz., & in their unbranded packing materials for packing of "Whole Wheat Flavor (Aatta)" &"Refined Wheat Flour (Maida) respectively. The comparison of Branded and Unbranded packing materials is placed in the images above. Apart from the above the tax pa....
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....on No.28/2017-Central Tax (Rate) dated 22.09.2017. 9. These unit containers used for the sale of unbranded goods contained the following graphic pictorial representation of farmers with agricultural implements which were common in unit containers used for branded goods:- 10. The petitioner had given up its rights over its Brand Name and the above graphic pictorial representation of farmers with agricultural implements in terms of Serial Nos.73 and 74 of Notification No.2/2017- Central Tax (Rate) dated 28.06.2017 as amended by Notification No.28/2017-Central Tax (Rate) dated 22.09.2017 and thus paid 'nil' duty on the larger unit packs of unbranded goods. 11. Since these packaged food products were governed by the provisions of the Legal Metrology Act, 2009 and by the provision of the Food Safety and Standards Act, 2006 (FSSA), the petitioner declared its corporate name on the unit pack. 12. The respondent however found the petitioner violating the above Notification as amended by the aforesaid subsequent Notification to deny the exemption. Earlier, search was conducted at the premises of the petitioner on 12.05.2022, pursuant to which the above Show Cause Notice in FORM ....
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....e Respondent. 19. Specifically, it is submitted by the learned counsel for the petitioner that the petitioner entertained a bona fide belief that the sale of food items, namely unbranded whole Wheat Atta, Maidha, etc., without the use of the petitioner's 'registered brand name' was exempted in terms of Serial Nos.73 and 74 of Notification No.2/2017- Central Tax (Rate) dated 28.06.2017 and later in terms of the amendment to it vide Notification No.28/2017- Central Tax (Rate) dated 22.09.2017. 20. The learned counsel for the petitioner, in reply, drew the attention of this Court to Paragraph No.16.8.2 of the impugned order, wherein observations were made as follows:- "16.8.1....A "house mark", while often used to signify the manufacturer's identity, still functions as a brand identifier under GST if it is registered and legally recognised as such. Further, I also would like to mention the Judicial precedents, such as Astra Pharmaceuticals Pvt Ltd Vs. Collector of Central Excise and Louise Vuitton India Pvt Ltd Vs. Commissioner of Central Excise, support the view that a house mark can indeed create a brand association, qualifying the goods as "branded good" for GST ....
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....it of Serial Nos.73 and 74 of Notification No.2/2017- Central Tax (Rate) dated 28.06.2017 as was amended by Notification No.28/2017 - Central Tax (Rate) dated 22.09.2017 was rightly claimed by the petitioner. 26. The learned counsel for the petitioner further submits that there is a clear disclaimer with respect to the above pictorial/graphic representation of farmers with their agricultural implements, to show that the petitioner was entitled to exemption under the above Notification. Therefore, it is submitted that the impugned order is liable to be interfered with. 27. It was further submitted by the learned counsel for the petitioner that the petitioner was acting under a bona fide belief that it was entitled to the benefit of Serial Nos.73 and 74 of Notification No.2/2017- Central Tax (Rate) dated 28.06.2017 as was amended by Notification No.28/2017 - Central Tax (Rate) dated 22.09.2017 and consequently, the extended period of limitation under Section 74 of the respective GST Enactments was not justified. 28. It is therefore submitted by the learned counsel for the petitioner that the petitioner cannot be accused of suppression or of any of the other ingredients conte....
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.... the following decisions:- I. Joint Commissioner (Intelligence & Enforcement) and Another vs. Lakshmi Mobile Accessories, represented by its Proprietor Badha Ramin W.A.No.258 of 2025 dated 05.02.2025., 2025 SCC OnLine Ker 852. 35. Adding further, the learned counsel for the petitioner submits that Section 74 (1) of the respective GST Enactments contemplates issuance of a Show Cause Notice on account of, or by reason of, fraud, wilful misstatement, suppression of facts, and non-payment of tax. It is therefore submitted that such Show Cause Notice has to be issued at least six months prior to the time limit specified under Section 74(10), as required under Section 74(2) of the respective GST Enactments. 36. It is submitted by the learned counsel for the petitioner that under Section 74(4) of the respective GST Enactments, a statement can also be issued for any other tax period where the assessee has not paid tax, where tax has been erroneously refunded, or where Input Tax Credit has been wrongly availed or utilized. 37. It is further submitted by the learned counsel for the petitioner that the service of such a statement under Section 74(3) of the respective GST Ena....
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....cope for issuance of a Show Cause Notice under Section 73 of the respective GST Enactments in the present case. SUBMISSIONS OF THE RESPONDENTS:- 41. On the other hand, the learned counsel for the respondent submits that, with regard to the bunching of proceedings pertaining to different years, the issue cannot be treated as settled in view of the interim stay granted by the Division Bench of this Court in W.A.No.3448 of 2025 dated 12.11.2025. Apart from that, the learned counsel for the respondents also refers to ae decision of the Bombay High Court wherein it has been held that the bunching of proceedings is permissible under GST laws. 42. It was submitted by the learned counsel for the respondent that the Hon'ble Supreme Court has taken away the basis of the reasoning arising out of the final judgement and order dated 26.08.2025 in M/s Mathur Polymers Vs. Union of India & Ors in W.P.No.2394 of 2025 passed by the High Court of Delhi, wherein the Court held as under:- "22. Thus, this Court is of the opinion that in case involving allegations of fraudulent availment of ITC, where the transactions are spread across several years, a consolidated notice may in fact be....
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....davit filed in support of the present writ petition and the Counter Affidavit filed by the respondents and the other materials on record. 50. The points for consideration in the present writ petition are as follows:- i. Whether the above graphic pictorial representation of farmers along with agricultural implements used commonly by the petitioner on packaging material can be said to be "brand name" of the petitioner for marketing the products? and ii. Whether the petitioner had claimed any monopoly over it to disentitle it the benefit of Sl.No.73 and 74 to the above Notification No.2/2017- Central Tax (Rate) dated 28.06.2017 as amended by Notification No.28/2017-Central Tax (Rate) dated 22.09.2017 or whether the petitioner had given up the monopoly over it or not in terms of the above Notification? 51. Trademark or the brand thus identifies the goods and/or service offered by its proprietor. It is intended to grab the attention of the consumer instantly to make an on the spot decision as to whether to buy the goods or pay for service of such proprietors. 52. The purpose of a trademark/service mark is to establish a trade connection between the goods and/o....
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....y its Constituted Attorney S.Satyanathan Vs. Nestle India Limited., 2020 SCC Online Mad 1158 while analysing the characteristics of 'Trade Mark' held as under:- "140. Once a mark or the brand has attained certain level of recognition and reputation, the buyers of goods or services may not even look beyond the brand or the mark. .... 147. According to him, within the above two basic categories of distinctive trademark, there are sub-categories that form the complete spectrum of distinctiveness of marks. Arrayed in an ascending order roughly reflecting their eligibility to trademark status and the decree of protection afforded, the categories are follows:- 1) generic terms; 2) descriptive; 3) suggestive; and 4) arbitrary or fanciful. 148. "Descriptive" words are not inherently distinctive while suggestive, arbitrary and fanciful terms are regarded as being inherently distinctive. [See McCarthy on Trademarks and Unfair Competition, 3rd Edition, J.Thomas McCarthy]. 149. A mark, which conveys character or quality of the goods, is a descriptive mark. It is an inherently weak mark and is almost incapable of b....
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....lly, it is known as 'house mark'. In Narayan's Book on Trade Marks and Passing-Off, the distinction between 'house mark' and 'product mark' (brand name) is brought out thus, "677A. House mark and product mark (or brand name). In the pharmaceutical business a distinction is made between a house mark and a product mark. The former is used on all products of the manufacturer. It is usually a device in the form of an emblem, word or both. For each product a separate mark known as a product mark or a brand name is used which is invariably a word or a combination of a word and letter of numeral by which the product is identified and asked for. In respect of all products both the product mark and house mark will appear side by side on all the labels, cartons etc. Goods are ordered only by the product mark or brand name. The house mark serves as an emblem of the manufacturer projecting the image of the manufacturer generally" The 'AP' or 'Astra' on the container or packing was used to project the image of the manufacturer generally. It did not establish any relationship between the mark and the medicine. For instance, if the appellant instead of using Dextrose in....
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....k capable of being represented graphically and which is capable of distinguishing the goods or services of one person from those of others and may include shape of goods, their packaging and combination of colours; and- (i) in relation to Chapter XII (other than section 107), a registered trade mark or a mark used in relation to goods or services for the purpose of indicating or so as to indicate a connection in the course of trade between the goods or services, as the case may be, and some person having the right as proprietor to use the mark; and (ii) in relation to other provisions of this Act, a mark used or proposed to be used in relation to goods or services for the purpose of indicating or so as to indicate a connection in the course of trade between the goods or services, as the case may be, and some person having the right, either as proprietor or by way of permitted user, to use the mark whether with or without any indication of the identity of that person, and includes a certification trade mark or collective mark; 63. The expression 'mark' is defined as follows in Section 2(m) of the Trade Marks Act, 1999 as follows:- Section 2(m): 'mark' i....
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....od, prior to its amendment by Notification No.28/2017- Central Tax (Rate) dated 22.09.2017 is extracted below:- "G.S.R. (E):- In exercise of the powers conferred by subsection (1) of section 11 of the Central Goods and Services Tax Act, 2017 (12 of 2017), the Central Government, being satisfied that it is necessary in the public interest so to do, on the recommendations of the Council, hereby exempts intra-State supplies of goods, the description of which is specified in column (3) of the Schedule appended to this notification, falling under the tariff item, sub-heading, heading or Chapter, as the case may be, as specified in the corresponding entry in column (2) of the said Schedule, from the whole of the central tax leviable thereon under section 9 of the Central Good and Services Tax Act, 2017 (12 of 2017). Schedule S. No. Chapter/Heading/Sub-Heading/Tariff item Description of Goods (1) (2) (3) 1 .. .. .. .. .. 73 1101 Wheat or meslin flour [other than those put up in unit container and bearing a registered brand name] 74 1102 Cereal flours other than of wheat or meslin, [maize (corn) flour, Rye flour, etc][ other....
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....gistered brand name; or (b) Bearing a brand name on which actionable claim or enforceable right in a court of law is available [other than those where any actionable claim or enforceable right in respect of such brand name has been foregone voluntarily, subject to the conditionals as in the ANNEXURE - I 71. The expression "actionable claim or enforceable right on a brand" for the purpose of the above exemption were defined in ANNEXURE-I vide amendment Notification No.28/2017-Central Tax (Rate) dated 22.09.2017 to read as under:- "ANNEXURE-I For foregoing an actionable claim or enforceable right on a brand name,- (a) the person undertaking packing of such goods in unit containers which bears a brand name shall file an affidavit to that effect with the jurisidictional commissioner of Central tax that he is voluntarily foregoing his actionable claim or enforeceable right on such brand name as defined in Explanation (ii)(a); and the person undertaking packing of such goods in unit containers which bear a brand name shall, on each such unit containers, clearly print in indelible ink, both in English and the local language, that in respect of the brand na....
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....ds for the purpose of indicating or so as to indicate a connection in the course of trade between the goods and the person using such a trade name or a brand name, with or without any indication. 76. The definition of 'Brand Name' in Notification No.2/2017- Central Tax (Rate) dated 28.06.2017 inserted/amended by Notification No.28/2017-Central Tax (Rate) dated 22.09.2017 can be simplified for the purpose of understanding as below:- Brand name means (i) brand name or; (ii) trade name, that is to say, ↓ which is used on the specified goods → (i) for the purpose of indicating or; (ii) so as to indicate, a connection in the course of trade between ↓ With or without any indication of the identity of that person (a) a brand name; or ↓ (b) a trade mark (1) Such specified goods and (2) Some person using such brand name or trade mark such as 1. Symbol, 2. Monogram, 3. Label, → 4. Signature, 5. invented word, 6.writing 77. The above pictorial representation which was commonly used in the unit containers by the petitioner for spec....
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....aptured above. For the sake of clarity, Paragraph No.5.7 from the impugned order is extracted below:- "05.07 However, the taxpayer claims exemption from payment of GST under GO (Ms) No.114 Dated 22.09.2017 issued by the State GST Department of Tamil Nadu by filing an affidavit with the SGST Department mentioning their products Maida, Sooji/Suji. R.Atta/Atta, Whole Wheat Atta as "UNBRANDED". They also declared that they print the disclaimer "We hereby voluntarily forego our all types of actionable claim or enforceable right in respect of brand name printed on this bag" both in English and Tamil. An affidavit on the similar lines furnished by the taxpayer vide Letter dated 24.01.2018 for claiming GST exemption under Notification No.02/2017 CT (Rate) dated 28.06.2017 as amended vide Notification No.28/2017 CT (Rate) Dated 22.09.2017 to the CGST department was returned to them vide Letter C.No.IV/16/35/2017-GST CELL (Pf) dated 16.04.2018 since the taxpayer is not using the brand name in the unit container, the need of filing affidavit for foregoing actionable claim would not arise." 84. In view of the declaration made in the Affidavit as mentioned above, the petitioner is e....
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....se notice has been issued for the earlier period on certain on certain set of facts, then, on the same set of facts another SCN based on the same/similar set of facts invoking the extended period of limitation on the plea of suppression of facts by the assessee cannot be issued as the facts were already in the knowledge of the department. It was observed in para 14 as follows: 14. We have indicated above the facts which make it clear that the question whether M/s Pharmachem Distributors was a related person has been the subject-matter of consideration of the Excise authorities at different stages, when the classification was filed, when the first show cause notice was in 1985 and also at the stage when the second and third show cause notices were issued in 1988. At all these stages, the necessary material was before the authorities. They had then taken the view that M/s Pharmachem Distributors was not a related person. If the authorities came to the conclusion subsequently that it was related person, the same fact could not be treated as a suppression of fact on the part of the assessee so as to saddle with the liability of duty for the larger period by invoking proviso to....
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.... required to be declared under Food Safety and Standards Act, 2006 and Legal Metrology Act, 2009 and the aforesaid graphic pictorial representation on the unit containers for the unbranded specified goods. 91. Although, the issue of bunching of multiple tax periods by issuance of a single Show Cause Notice was raised, the larger issue is still pending before the Hon'ble Division Bench of this Court and in view of the above discussion on merits that the petitioner is indeed entitled to the benefit of Notification No.2/2017- Central Tax (Rate) dated 28.06.2017 by Notification No.28/2017-Central Tax (Rate) dated 22.09.2017 in the light of the Affidavit filed by the petitioner, I am refraining from expressing any opinion on the issue of bunching of multiple tax periods by issuance of a single Show Cause Notice. 92. In view the above discussion, the present writ petition is allowed. Connected Miscellaneous Petitions are closed. No costs. ============= Document 1 WHEAT FLOUR - (மைதா) - PRE- NY Por- mot product Wheel. 10 kg what not produced (B) , Alue . LI (Tp) Document 2 MARRIED MILAT FLOUN gfior ) +% BADCI NO: PHER MAS....
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