ORDER
G.N. Srinivasan, Member (T)
1. This is an appeal filed by the appellants against the decision of the Commissioner of Cen. Excise (Appeals), Mumbai, whereunder, the Commissioner (Appeals) had confirmed the Order-in-Original No. 29/93, dated 13-12-1993 passed by the Asstt. Collector approving the four classification lists filed by the appellants with effect from 1-3-1992 to 6-4-1993, denying the benefit of exemption claimed by the appellants under Notification Nos. 175/86 and 1/93.
2. The appellant has been engaged in the manufacture of solenoid valves and spares falling under Heading No. 84.81 and for this purpose they have their factory at Manpada Road, Dombivali (East) Thane. The appellants were registered as SSI and they have held necessary SSI registration certificate. The final products manufactured by the assessee were cleared by them after affixing the brand name “SEITZ-ROTEX” with monogram SEITZ, SEMPRESS AND ROTEX. The appellant had registered the monogram ‘S’ with an arrow inside it and also the monograph with the words ROTEX TT Pneumatics and the words SEITZ-ROTEX and ‘ROTEX’. This was registered on 4-6-1995 with effect from 1978. The appellant also sought to register the words ‘TT’ vide their application dated 21-6-1985. The appellant file 4 classification lists and claimed exemption under Notification Nos. 175/86 and 1/93. The Asstt. Collector by the Order-in-original denied the exemption on the ground that the assessee confirmed that they have been using the brand name of SEITZ ROTEX AND SEMPRESS and ROTEX. The appellant filed appeal before the Commissioner (Appeals) who by the impugned order confirmed the Order-in-original. Hence, the present appeal.
3. Shri Willingdon Christian, Advocate alongwith Shri Mayur Shroff Advocate appeared for the appellant and Shri Deepak Kumar, SDR appeared for the revenue.
4. Shri Willingdon Christian argues that the approach of the authorities in denying the exemption under the two notifications are wrong in law. He states that it is not the case of the appellant that the foreign company M/s. Eugen Seitz A.G. owns any trademark with the words SEMPRESS AND ROTEX. In the instant case, the final products, the appellants have put the monogram S with an arrow mark along with the words SEITZ-ROTEX. He states that with no stretch of imagination can there be any connection between the monogram which is registered from 1978 onwards and the above words, it can never be anybody’s case that the words will have any connection with the said trade mark. He also states that the word ‘SEMPRESS and ROTEX’ with the words TT will have any connection with the foreign manufacturer. He states that the logic administered by the Commissioner (Appeals) is not correct in law.
5. Shri Deepak Kumar, ld. DR enthusiastically argues that explanation annexed to the notification enlarged the scope of brand name or trade name as contained in Explanation VIII para 7 of the Notification No. 175/86. He specifically argues that the words SEMPRESS ROTEX indicates the relationship with the products and the trade mark of the foreign company.
6. We have considered the rival submissions. During the course of the arguments, Shri Christian cites a number of judgments. They are –
1. Palsons Drugs and Chemical Industries v. C.C.E., Calcutta 1998 (98) E.L.T. 665 (Tri.);
2. U.O.I. v. Pillaiyar Soda Factory – 1992 (57) E.L.T. 261 (Mad.);
3. Rnkmani Pakkwell Traders v. C.C.E. – 1999 (109) E.L.T. 204 (Tri.);
4. DC/ Pharmaceuticals P. Ltd. v. C.C.E., Goa – 1999 (32) RLT 956.
We have considered the facts in those cases and we are of the view that those facts are entirely different from the facts in the instant case before us. Hence, the ratio of those cases will not be applicable.
7. In this case we asked the ld. DR specially as also the ld. Counsel, whether any show cause notice was issued proposing to deny the exemptions claimed by the appellant under the notifications. Both the sides replied that no such show cause notice has been issued. In the background of it, the Commissioner (Appeals) in the impugned order has denied the exemption on the following lines :
” The first contention relied on in the appeal is that the brand names belongs to the appellants and that they are not using the brand name belonging to any other person. The above contention is difficult to accept if the following definition of brand name/trade name in 175/86 and 1/93 is taken into account. “Brand name or trade name shall mean a brand name or trade name, whether registered or not, that is to say a name or a mark, such as symbol, monogram, label, signature or invented word or writing which is used in relation to such specified goods for the purpose of indicating, or so as to indicate a connection in the course of trade between such specified goods and some person using such name or mark with or without any indication of the identity of that person”. It is clear from the above definition that for the purpose of Notifications 175/86 and 1/93, it is not essential that the ownership of a brand name must be established through registration. It is sufficient if by the usage of such brand name, the linkage between the goods and the company is established. In the instant case, the use of “Sempress” and “Seitz” definitely establishes such a link between the goods of the appellants with the erstwhile foreign collaborators. Thus the appellants are selling the goods with brand name of another person. M/s. Sempress and M/s Seitz are obviously not eligible for the benefit of Notification 175/86.”
8. If we go through the logic of the above observation, we are of the view that it is wrong in law for the following reasons:
Whenever any quasi-judicial authority proposing to deny the exemption, it must specifically state the ground on which such action is to be taken. Here the facts are that on the product the words ‘Sempress and Rotex, Dombivali are mentioned. In the other products, the words ‘Sempress and Rotex’ are affixed alongwith the monogram S and TT. From the above words, it does not reveal any relationship between the trade mark as well as the foreign company. Here the words are ‘Sempress Rotex and Seitx Rotex’ Dombivali. If the words are quoted with the foreign company, one may possibly come to the conclusion that the monogram may have certain relationship. But in the instant case, the words Seitex Rotex have been affixed in the product. It cannot mean that the words can have any relationship with any trade mark indicating that the quality of the product is assured because the trade mark is owned by the foreign company. Moreover, the entire action is wrong in law because show cause notice is not given. Therefore, in our view, the order is not sustainable and hence the appeal is allowed.