ORDER
S.L. Peeran, Member (J)
1. Both these appeals arise from Order-in-Original No. 9/99, dated 24.9.1999 denying the benefit of SSI exemption and imposing penalty on the Director. The appellants had entered into an agreement with M/s. The Mysore Kirloskar Ltd. and it appeared that the appellants manufactured lathes under the brand name of “Shimoga Lathes”. As they had affixed a label on the lathes as “Shimoga Lathes”, therefore they were alleged to have the brand name of M/s. The Mysore Kirloskar Ltd. Hence they were held to be not eligible for the benefit of the SSI Notification. The appellant’s contention was that they have not used the logo/monogram or trade mark of M/s. The Mysore Kirloskar Ltd., the agreement had only mentioned that they were the manufacturers under licence from M/s. The Mysore Kirloskar Ltd. and they are paying royalty and that by itself will not disentitle them from the benefit of the Notification. They had no intention in evading payment of duty, as using manufacturer under licence from M/s. The Mysore Kirloskar Ltd. They contended that this by itself would not disentitle them from the benefit of the Notification. The assessee relied on the Apex Court judgments rendered in the following cases to plea time-bar.
(i) Tamil Nadu Housing Board v. CCE Madras .
(ii) Pushpam Pharmaceuticals Company v. CCE Bombay .
(iii) CCE v. Chemphar Drugs & Liniments .
(iv) Padmini Products v. CCE .
(v) Astra Pharmaceuticals (P) Ltd. v. CCE Chandigarh .
However, the authorities have not accepted their plea and have denied the benefit of the Notification and have also imposed penalty.
2. The learned Counsel was confronted with the Apex Court judgment rendered in the case of CCE Trichy v. Grasim Industries wherein it has now been held that the trade name would cover the name of the company also and after the same has been affixed or used in the course of trade between the product and the other person, then the benefit of SSI is required to be denied. However, the Apex Court has set aside the penalty on the plea that there was no intention to evade duty, in view of the earlier Tribunal judgment rendered in the case of Astra Pharmaceuticals (supra). The learned Counsel submitted that even in terms of this Apex Court judgment, the Apex Court has taken note of the earlier judgment rendered in the case of Astra Pharmaceuticals (supra) to set aside penalty. He submits that when there is no intention to evade duty, in view of existing of an earlier ruling of the Apex Court in the case of Astra Pharmaceuticals (supra) which held that affixing the company’s name would not disentitle the benefit of the Notification, therefore, in that circumstance, there was no intention to evade duty and hence, the benefit of time-bar should be extended to them.
3. The learned SDR submitted that in view of the Apex Court’s revised judgment in the case of CCE v. Grasim Industries Ltd., the assessee is not entitled for the benefit of the Notification. He relied on the findings given by both the authorities on time-bar. He submitted that the agreement had not been submitted to the Department and the fact that the appellant manufactured under licence of M/s. The Mysore Kirloskar Ltd. had not been disclosed and hence there was suppression of facts.
4. On a careful consideration, we are of the considered opinion that in the light of the Apex Court judgment rendered in the case of CCE v. Grasim Industries Ltd., the assessee will not be eligible for the benefit of the Notification. In view of the fact that the Apex Court has now held that trade name would cover the name of the company also and as long as it is used for indicating a connection in the course of trade between the product and the other person, then the benefit of SSI exemption is not available. However, the Apex Court has set aside the penalty. As there was existence of an earlier Supreme Court judgment rendered in the case of Astra Pharmaceuticals (supra) holding that use or affixing the company’s name would not dis-entitle the benefit of Notification. In the present case, the appellants have not used any brand name or trade name but only affixed a label to say that the lathe is manufactured under the licence of M/s. The Mysore Kirloskar Ltd. The benefit of Notification is not eligible as held by the authorities in view of the Apex Court judgment rendered in the case of CCE v. The Grasim Industries Limited. However, in terms of the very said judgment, penalty is not leviable. The appellants had bona fide belief that they had not suppressed any facts with an intention to evade duty. The law as on that day gave the benefit of exemption, in such cases as can be seen from the Apex Court judgment rendered in the case of Astra Pharmaceuticals (supra). Therefore, the plea of the assessee before the authorities that larger period should not be invoked is to be accepted in the light of the Apex Court judgment rendered in the case of Tamil Nadu Housing Board v. CCE, Madras (supra); Pushpam Pharmaceuticals (supra); Chemphar Drugs (supra); Padmini Products (supra); Astra Pharmaceuticals (supra). As the demands have been raised invoking larger period, the benefit of time-bar has to be given to the assessee. The appeals are allowed on the time-bar alone.
(Operative portion of this order was pronounced in open Court on conclusion of hearing)