COMMISSIONER OF CENTRAL EXCISE Vs. KHANNA INDUSTRIES
LAWS(SC)-2006-11-151
SUPREME COURT OF INDIA
Decided on November 28,2006

COMMISSIONER OF CENTRAL EXCISE, CHANDIGARH Appellant
VERSUS
KHANNA INDUSTRIES Respondents


Referred Judgements :-

MENTHA AND ALLIED PRODUCTS VS. UNION OF INDIA [REFERRED TO]
NAMTECH SYSTEMS LTD. V. COMMISSIONER OF CENTRAL EXCISE,NEW DELHI [REFERRED TO]


JUDGEMENT

Arijit Pasayat, J. - (1.)In these appeals, Revenue questions correctness of the judgment rendered by the Customs, Excise & Gold (Control) Appellant Tribunal, New Delhi, (in short CEGAT). It was held by the impugned judgment that the respondents were eligible to avail benefit of the exemption notification No.175/86-CE and para 7 thereof will not be attracted in the present case. Appeals filed by the Revenue questioning correctness of the decision rendered by the Commissioner (Appeals), Central Excise & Customs, Chandigarh (in short Commissioner (Appeals)), were dismissed.
(2.)The background facts in a nutshell are as follows:
Respondents manufacture Brass Sanitary Bathroom fittings falling under Sub-heading 8481.80 and 8481.99 of the Schedule to the Central Excise Tariff Act, 1985 (in short Tariff Act). The goods were packed in cardboard boxes on which stylised brand name "ARK" was printed and labels affixed on cardboard boxes also showed the brand name "ARK" in the stylised script; name and address of M/s. Arkson Pvt. Ltd., Chandigarh was also printed on the label; in addition "ARK" was put on the Sanitary fittings by pasting stickers and also by affixing tickli on the body of the fittings. All the respondents were availing exemption under Notification No.175/86-CE. Proceedings were started against them for demand of duty as brand name "ARK" in stylised script was brand name of M/s. Arkson Pvt. Ltd. Initially the matter was decided by the Collector, Central Excise who denied the exemption under Notification No.175/86-CE holding that the respondents were affixing specified goods with the brand name of another person not eligible for the grant of exemption and also there was suppression on the part of the respondents. On appeal filed by the Assessees, the CEGAT remanded the matter for de novo decision after arriving at a finding in regard to the eligibility to exemption of M/s. Arkson Pvt. Ltd. under Notification No.175/86-CE and to arrive at a definite finding in regard to other pleas of use of trade mark w.e.f. April, l992 and other related matters concerning time bar. The CEGAT, however, gave specific finding that stylised "ARK" is a trade name of M/s. Arkson within the meaning of relevant para of Notification No.175/86-CE.

(3.)On remand the matter has been decided by the Additional Commissioner who confirmed the demand of duty and imposed penalty on all the respondents holding that since M/s. Arkson Pvt. Ltd. was not eligible for the benefit of Notification No.l75/86-CE since it was not holding any L-4 licence; the casting of pig iron manufactured in their proprietary concern M/s. Arkson Engg. Co. was exempted from payment of duty under Notification No.208/83 dated 1.8.1983 and no declaration as required to be filed under Rule 174 of the Central Excise Rules, 1944 (in short the Rules), was filed by it; castings falling under Sub-heading 7325.10 of the Tariff were specified in the Annexure to the Notification. In addition the Additional Commissioner, relying upon decision in the case of Mentha and Allied Products v. Union of India 1995 (77) ELT A 133(SC), concluded that aggregate sale figure of M/s. Arkson Pvt. Ltd. was more than Rs. 2 crores during 1990-91 and 1991-92 and accordingly the benefit of Notification was also not available to it. The Additional Commissioner gave findings to the effect that the respondents had started affixing stylised brand name "ARK" w.e.f. September, 1991 and not from April, 1992 as contended and extended period of limitation was inviolable as the fact regarding manufacture of the goods affixed with brand name another person was never brought to the knowledge the Department.


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