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2016 (3) TMI 1047 - CESTAT CHENNAI

2016 (3) TMI 1047 - CESTAT CHENNAI - 2016 (338) E.L.T. 134 (Tri. - Chennai) - Benefit of SSI Notification No.8/2003 - whether assessee have used the brand name of other person and whether the demand is hit by limitation and, consequently, penalty is imposable or not? - Held that:- Concept of ‘similar’ etc. cannot be used to interpret the meaning of the word occurring in the notification by taking recourse to modes other than plain language. We find that para-4 of the notification stipulates that .....

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e appellants cleared the goods indicating their company name ‘Elac" followed with Excel’. Therefore, it cannot be construed that they have affixed brand name of other person. - The brand name of ‘Elac Excel’ used by the appellant on Automatic Storage Water Heaters is not a brand name / trade name of any other person and not hit by para (4) of SSI Notification and they are eligible for the SSI exemption limit of ₹ 1.5 crores under the said notification. - Appeal Nos. E/41183/2014 & E/41 .....

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. Ltd. is registered with Central Excise for manufacture of Instant Water Heaters and Automatic Storage Water Heaters and discharging Central Excise duty after crossing the SSI exemption limit of ₹ 1.5 crores as per Notification No.8/2003 dt.1.3.2003. SCN No.42/2013 dt. 11.7.2013 was issued for denying the SSI benefit on the goods viz. Automatic Storage Water Heaters manufactured and cleared by them bearing the brand name of "Elac Excel" and "Elacvarmxpress' etc. as the .....

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, ' Elac Excel Fiesta' and 'ElacVarm Slim'. and confirmed the demand of Excise Duty of ₹ 83,42,016/- under proviso to Section 11A (1) of the Central Excise Act along with interest and also imposed equivalent penalty under Section 11AC. He also imposed penalty of ₹ 10 lakhs under Rule 26 of the Central Excise Rules 2002 on Shri K.S. Ganesh, Director of appellant-company. Hence the present appeals. 3. Heard both sides. Ld. Advocate Shri S. Murugappan appearing for the a .....

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llants are using the name "Elac Excel" and they applied for registration of their Trade Mark 'Elac Excel' on 16.8.2012 before the Trade Mark Authority and again on 21.8.2012, they filed another application for the Elac Excel with a different background. Both their applications were under process. He submitted that they are using the brand name "Elac Excel" since 29.10.2009 which is mentioned in the trade mark application. 3.1On limitation, Ld. advocate submits that SC .....

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tral Excise office and statements were recorded and after the verification, the officer satisfied and the records were returned. He submits that there is no copy of the statement given to them. They were also under the bonafide belief that "Elac Excel" is not the brand of M/s. K.I. Industries as they have already applied for registration of their trade mark "Elac Excel". There is no suppression as the department is well aware of the investigation from 17.4.2012 whereas SCN wa .....

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lleges that brand name appeared to be 'similar' and akin to the brand name Elac and not the 'same' whereas as per the SSI notification the exemption benefit is not available on goods bearing the brand name of others and they have not affixed any brand name of other person. There is difference between the words "similar" and "same". In support of this, he relied the Hon'ble High Court decision in the case of UOI Vs Pillaiyar Soda Factory - 1992 (57) ELT 261 .....

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ac varmxpress", "Elac Excel Fiesta" and 'Elac Varm Slim' are names of different models of "Elac Excel" itself and not the brand name. He drew our attention to Registration Manual of Bureau of Indian Standards (BIS) and Bureau of Energy Efficiency (BEE) at pages 52 to 55. 5. Regarding allegation of common advertisement expenses, he submits that there is no common expenditure incurred for advertisement of their product with products of M/s.K.N. Industries. He submi .....

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i.-Del.) (5) CCE Chandigarh Vs Speedway Rubber Factory-2003 (154) ELT 207 (Tri.-Del.) (6) AGI Switches (P) Ltd. Vs CCE New Delhi-1999 (111) ELT 440 (Tribunal) (7) Commissioner Vs AGI Switches Pvt. Ltd.-2005 (183) ELT A196 (SC) (8) J. Prasad Polymers Vs CCE Meerut-2003 (155) ELT 486 (Tri.-Del.) Therefore he pleaded that they are eligible for SSI exemption benefit on their own brand "Elac Excel" and pleaded to set aside the impugned order and also submits that Shri K.S. Ganesh, Director, .....

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g to another person. 6.1 On limitation, he submits that demand is not hit by limitation as summons were given to both Elac Marketing Pvt. Ltd. and K.N. Industries and there is no evidence of recording of any statement or verification of records and returning of records as contended by the counsel. Therefore, the transaction came to light only from the date of visit of officers to the premises of appellant on 2.11.2012 which is correctly recorded in the order. He further submits that the goods we .....

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l is only a model name of Elac and not a separate name. He also submitted that advertisement were made only in the name of Elac Water Heaters. He submits in common trade parlance it is sold and bought as in the name of Elac only. He relied on following case laws. :- (1) CCE Chandigarh Vs Bhalla Enterprises-2004 (173) ELT 225 (SC) (2) CCE Visakhapatnam Vs Mehta & Co. -2011 (264) ELT 481 (SC) (3) CCE Trichy Vs Rukmani Pakkwell Traders-2004 (165) ELT 481 (SC) (4) CCE Chandigarh Vs Mahaan Dairie .....

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No.8/2003 and whether they have used the brand name of other person and whether the demand is hit by limitation and, consequently, penalty is imposable or not. There is no dispute on the fact that appellant is a private limited company functioning in the name and style of "Elac Marketing Private Limited" as evident from certificate of Incorporation No.18-45257 of 2000 dt. 26.6.2000 issued by the Registrar of Companies, Tamil Nadu. On perusal of OIO, SCN as per para -5 of the SCN, it wa .....

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ting the parts and manufacturing the finished goods in the said premises and clearing in their name Elac Excel whereas the goods manufactured by K.N. Industries for water heaters on metal body (powder coated stainless steel) and cleared under the registered brand name of Elac. Therefore it is evident that the products cleared by appellant's brand name is Elac Excel which is made of ABS body (plastic body) and the product manufactured and sold by K.N. Industries is water heaters Stainless Ste .....

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a Trademark for goods and services (other than a collective mark or a certification trade mark) in the Register. Section 18(1} Rule 2S(2} Application is hereby made for registration in the register of the accompanying Trademark in class 11, in respect of Apparatus for heating, steam generating, cooking, drying ventilating, in the name of Elac Marketing (P) Limited, at 328A, Arcot Road, Chennai 600 024, Tamil Nadu State, Indian National, who claims to be the proprietor thereof and by whom the tra .....

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anation unmistakably shows that the expression common trade mark aerated waters implies aerated waters which are sold under the same trade mark or under the same brand name in more than one factory, whether belonging to one or more manufacturers. Thus, the sale must be with the same trade mark or brand name in order to attract the categorisation of common trade mark aerated waters , for the purpose of the notification. Can the use of a similar or deceptively similar or deceptively identical trad .....

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of similar or deceptively similar , or more or less identical , is a concept borrowed from the Trade and Merchandise Act or the Copyright Act, which is not of exactitude but of latitude. That concept has relevance to an action in passing off etc. It is aimed for the protection of innocent or unwary customers. In our opinion, it would not be proper to import that concept while interpreting a notification issued under the Central Excise Rules, as it would have the effect of enlarging or restricti .....

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trade mark . The authorities did not use the word either similar or identical . The word same has an absolutely different meaning than the word similar or identical . For example, if it were said that A and B live in the same house , it would imply that they were living in one house, while if it were said that -A and B live in similar" houses or in identical houses, obviously, the implication would be that A and B live separately . Therefore, the word same cannot be construed to be synonym .....

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s sell the product under the same trade mark or brand name. It is a fundamental rule for the construction of statutes, that where the language is plain and clear, the words must be held to have been used, according to the plain and ordinary meaning of the term to determine their connotation or meaning. Therefore, using the well settled rule of interpretation, the conclusion is irresistible that the Collector fell in error in construing same as similar or even deceptively similar to deny the bene .....

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me of another person. In the present case, appellants have not used the brand name of Elac of another person but cleared under their own brand name Elac Excel . 10. Further, it is pertinent to state that as already dealt the issue in the preceding paragraphs, the Appellant s name of the company itself is M/s.Elac Marketing Pvt.Ltd. The company name itself has the word Elac which is part of the company s name and the appellants cleared the goods indicating their company name Elac" followed w .....

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n. We see no reason to take a different view on this aspect. 5. However the respondents also sell pickle with the name Mahaan written in exactly the same style as a registered trade mark of other Company. The question would be whether by adding the words Taste Maker the Respondents could get the benefit of the Notification. The Hon ble Supreme Court in the above judgement has clearly held that when the appellant is using the name of their company should not disentitle them from claiming the bene .....

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gment was upheld by the Hon ble Supreme Court as reported in CCE Vs AGI Switches Pvt. Ltd.(supra) where the Hon ble apex court by relying their own judgment in the case of CCE Vs Bhella Enterprises - 2004 (173) ELT 225, held thatthere is no reason to interfere with the reason of Tribunal. We also find that Tribunal in the case of A.J. Bantex (P) Ltd. Vs CCE Bangalore (supra) on an identical issue, allowed SSI benefit. In A.J. Bantex case the Tribunal clearly held that the company registered unde .....

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