TMI Blog2018 (3) TMI 613X X X X Extracts X X X X X X X X Extracts X X X X ..... t engaged in the manufacturing of the goods, they are only doing trading activity of bought out goods. SSI exemption - brand name - whether the appellant is owner of brand CONA and consequently entitle for SSI exemption? - Held that: - brand was transferred to the appellant by way of Assignment Deed dated 10-12-1996. Moreover, the appellant also made application to Trade Mark Registry on 20-12-1996 for ownership of CONA brand in their name which was registered in their name on 21-2-2003 but it was effective from 10-12-1996. These facts clearly establish that from 10/20-12-1996 appellant became brand owner of CONA - appellant is owner of the brand CONA and consequently entitle for the SSI exemption. Whether extended period under proviso to section 11A(i) and penalty under Section 11AC and/or redemption find are invokable/imposable? - Held that: - the entire facts regarding use of brand name CONA as well as activity of the appellant was well within the knowledge of the department. Moreover after getting convinced initial proceedings was dropped therefore it cannot be said that there was any mala fide intention or suppression of facts on the part of the appellant - extended peri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on benefit of Notification No. 8/2001 dated 1-3-2011, Notification No. 8/2002 dated 1-3-2002 and Notification No. 8/2003 dated 1-3-2003 in terms of Para 4 of Notification No. 8/2001 dated 1-3-2001 and similar notifications, penalty equal to the duty under Section 11AC and/or under Rule 25 of the Central Excise Rules, 2002, interest under Section 11AB, confiscation of the goods valued at ₹ 51,99,497/- seized on 16-3-2006 from premises of M/s. Sony Enterprises, personal penalty on Shri. Kapil R Motwani, proprietor of the appellant firm was also proposed. The adjudicating authority vide the impugned order passed following order: (a) Confirmed of duty demand of ₹ 69,35,927/- (b) Demanded interest under Section 11AB (c) Imposed penalty of ₹ 69,35,927/- under Section 11AC read with Rule 25 (d) Personal penalty of ₹ 1734000/- imposed on Shri. KapilMotwani (e) Seized goods were confiscated with an option to redeem the same on payment of redemption fine of ₹ 52 Lacs. Being aggrieved by the said order, appellant filed the present appeals. 2. Shri. M.H. Patil, Ld. Counsel for the appellant submits that as regard the issue of brand ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce the brand name CONA was assigned by Original owner of the brand name, Shri. Naraindas M Motwani to the appellant, they are also eligible for benefit of SSI exemption. In support of which reliance was placed on the following judgment: (a) Bonny Baby Care Pvt Ltd[2014(302)ELT 454(T)] (b) Bonny care Pvt Ltd [2016(343)ELT 1097(T)] (c) VenkateshYedidha[2016(332) ELT 860] (d) Otto Bilz(India)Pvt Ltd [2015(324)ELT 430] (e) Jepika Paints [2008(232)ELT 424(T)] He submits that ratio of the judgments relied upon by the Revenue in case of VeeGee Faucets Ltd [2010(259)ELT 273 (Tri. Del)] is not applicable to the present case as in that case period of dispute was from Feb, 2001 to Jul, 2003 and date of assignment was made on 1-4-2003, application for registration of brand with TMR was made n 23-7-2003 and registration certificate was issued on 6-4-204 hence the fact of that case is different. As regard the issue that whether the activity carried out by the appellant amount to manufacture or otherwise, he made following submissions: (a) The activity of quality checking, branding and packing of electrical fitting does not bring into existence any distinctly diff ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch amounts to manufacture; that by their letter dated 20-11-2000 appellant requested for release of the seized goods and drop the proceedings; that even if the activity amounted to manufacture SSI exemption was available up to ₹ 1 Crore, that by letter dated 20-12-2000 Dy. Commissioner Central Excise on the basis of examination of the matter, released the goods unconditionally. The appellant s seized documents were also released, to which the appellant vide their letter dated 19-12-2001 acknowledged with thanks. The issue in dispute that activity not amounting to manufacture and ownership of the brand name CONA was resolved in their favour by dropping of proceedings and not issued the show cause notice. However, on the same issue again investigation were initiated, which culminated in issuing of show cause notice and passing the impugned order invoking extended period. In the above facts there is no suppression of facts on the part of the appellant, hence the demand for extended period barred by limitation. During the normal period of show cause notice i.e. 2005-2006 the value of clearance was only ₹ 26,40,240/-as evident from annexure A to Show cause notice which is le ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CONA brand and packing of electrical parts and fittings received in loose condition amount to manufacture in light of note 6 of Section XVI of Central Excise Tariff Act and Section 2(f)(iii) of Central Excise Act and in respect of goods falling under Chapter 85.36, whether it amounts to manufacture in terms of IIIrd Schedule of Central Excise Act, 1944 w.e.f. 1-3-2003. (b) Whether SSI exemption under Notification No. 8/2001-CE, dated 1-3-2001 notification No. 8/2002-CE dated 1-3-2002 and Notification No. 8/2003-CE dated 1-3-2003 are available in case where appellant, M/s. Sony Enterprises and M/s. S.K. Enterprises were joint owner of the brand name CONA and w.e.f. 10-12-1996, the same brand is also owned by the appellant as per confirmation of Trade Mark Registry. (c) Whether extended period under proviso to section 11A(i) and penalty under Section 11AC and/or redemption find are invokable/imposable. 8. As regard the first question, we find that the Adjudicating authority has solely relied upon Note 6 of Chapter XVI of Central Excise Tariff Act read with Section 2f(iii) Central Excise Act, 1944 which reads as under: Note 6 of Chapter XVI - 6. In respect of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rading activity of bought out goods. 9. As regard the issue whether the appellant is owner of brand CONA and consequently entitle for SSI exemption. On examination of the records the fact emerged that though the brand was found to be owned by M/s. CONA Industries as per the search conducted by the departmental officer but fact also remains that very same brand for the electrical goods was also registered in the name of the grandfather of the proprietor of the appellant firm Shri. Naraindas M Motwani trading as M/s. S.K. Traders. Subsequently, brand was transferred to the appellant by way of Assignment Deed dated 10-12-1996. Moreover, the appellant also made application to Trade Mark Registry on 20-12-1996 for ownership of CONA brand in their name which was registered in their name on 21-2-2003 but it was effective from 10-12-1996. These facts clearly establish that from 10/20-12-1996 appellant became brand owner of CONA . 10. As regard the issue whether appellant should be considered as an owner of the brand from 2003 or from 10/20-12-1996, Hon ble Supreme Court in case of Commissioner of C. Ex. Mumbai-IV Vs. Damnet Chemicals Pvt Ltd 2007 216 ELT 3 (SC) it was held that even ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... egard the limitation, whether the demand is time barred or otherwise, we find that the show cause notice dated 19-6-2006 issued for the period 1-4-2001 to 31-3-2006 invoked extended period. It is observed that vide letter dated 6-4-1998 addressed to Asstt. Commissioner of Central Excise the appellant declared regarding their activity of labelling, embossing, packing etc of bought out goods, electrical accessories and appliances falling under Chapter 84, 85 and the same is not amount to manufacture. They have also declared regarding affixing of brand name as per the agreement with their respective brand owner. On 7-11-2000 and 8-11-2000 preventive staff of the department had seized the goods of the appellant on the ground that activity carried out by the appellant is amount to manufacture. In this regard appellant vide letter dated 10-11-2000 made detailed explanation and requested for release of seized goods vide the said letter appellant also enclosed the copy of their earlier letter dated 3-4-1998 and copy of opinion obtained from Central Excise reporter. Dy commissioner vide his letter dated 20-12-2000 ordered for release of seized goods unconditionally after getting convinced w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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