M/S. SADANA FOODS Vs. CCE, VISAKHAPATNAM

JUDGEMENT

(1.) ON a perusal of the records and hearing both sides, we find that the short question arising for consideration in this case is whether SSI benefit was admissible to the appellant in respect of cakes and pastries which were supplied to customers under the brand name HOT BREADS which was assigned to them by the brand name owner M/s. Chaitanya Foods, Madras under a deed of assignment. The period of dispute is from 01/03/1997 to 30/06/1998. The learned counsel for the appellant submits that, under the deed of assignment executed by M/s. Chaitanya Foods, Madras in favour of the appellant, the appellant was entitled to use the above brand name within the limits of the revenue districts of Visakhapatnam and Vizianagaram to the exclusion of all others. It is submitted that no other manufacturer of cakes and pastries within the said territory had any right to use the above brand name. Therefore, according to the learned counsel, the benefit of the relevant SSI exemption notifications cannot be denied to the appellant on the ground that the goods were supplied under the brand name of M/s. Chaitanya Foods, Madras. In this connection, he has relied on Collector vs. Vikshara Trading & Investment Pvt. Ltd. [2003(157) ELT 4 (SC)] wherein the benefit of a similar notification was held admissible to the assessee in respect of specified goods cleared under a brand name which was assigned to the assessee by another company. The apex court held that the benefit was not deniable to the assessee by reason of the assignment deed not having been registered. Reliance has also been placed on Commissioner vs. Sree Ram Perfumery Works [2009(241) ELT 89 (Tri. Chennai)] wherein the brand name used by the assessee (SSI unit) was found to have been assigned to them by the brand name owner and it was held that the assessee should be considered to have used their own brand name. The Tribunal, on this basis, granted SSI benefit to the assessee in respect of the branded goods. Per contra, the learned Superintendent(AR) claims support from Commissioner vs. Dhanvi Trading & Investment (P) Ltd. [2005(187) ELT 270 (Tri. Del.)] wherein the ownership of a brand name which was assigned to the assessee was found to be vested in the assignor and, on this basis, benefit of SSI Notification No.175/86 -CE was denied to the assessee by virtue of para 7 thereof. It is further submitted that the Tribunal s decision in Dhanvi Trading & Investment (P) Ltd. (supra) was rendered in pursuance of the remand order passed by the Hon'ble Supreme Court in the case of Vikshara Trading & Investment Pvt. Ltd. (supra). After considering the submissions, we have found valid reasons to hold that SSI benefit cannot be denied to the appellant in respect of the subject goods on the ground that these goods were supplied to customers under a brand name belonging to another person. It is not in dispute that the brand name HOT BREADS was assigned to the appellant by M/s. Chaitanya Foods, Madras and that the appellant thereby acquired exclusive right to use it on cakes and pastries within the territorial limits set out in the deed of assignment. It is not in dispute that, within such territory, nobody else, nor even the brand name owner, had the right to use the brand name on identical or similar goods. The notifications referred to brand name of another person in the context of providing that the notifications shall not be applicable to goods cleared under a brand name or trade mark of another person. Similar provisions were considered by the Hon'ble Supreme Court in numerous cases including the case of Vikshara Trading & Investment Pvt. Ltd. (supra). In the said case, the deed of assignment, wherein a trade mark was assigned to the assessee by its owner, was not registered and, on that basis, the SSI benefit under Notification No.223/87 -CE was denied to the assessee by the Department. The Hon'ble Supreme Court held that registration of the deed of assignment was immaterial and that the goods cleared under the assigned trade mark by the assignee were not hit by the exclusion clause of the SSI Notification. In the case of Sree Ram Perfumery Works Ltd. (supra), this Tribunal considered a similar case where the SSI Notifications involved were No.140/83 -CE and No.10/99 -CE. The brand name affixed by the assessee on the goods in question was one assigned to them under an agreement executed by the brand name owner. This Tribunal held that the assessee could be said to have used their own brand name and accordingly held that the benefit of the Notifications was admissible to them. The submission made by the learned Superintendent (AR) with reference to the remand order passed by the Hon'ble Supreme Court is of no significance inasmuch as it was an open remand ordered by the apex court in the case of M/s. Dhanvi Trading & Investment Pvt. Ltd., one of the cases considered by the apex court in the reported case of Vikshara Trading & Investment Pvt. Ltd. (supra). It has been pointed out that the Tribunal s decision in Dhanvi Trading & Investment Pvt. Ltd. [2005(187) ELT] was rendered in pursuance of the above remand order. We have perused this order of the Tribunal as well. The Notification considered therein was No.175/86 -CE, para 7 of which created a bar in respect of specified goods cleared by an SSI unit after affixing the brand name of another person. We find that the Tribunal s decision cited by the learned Superintendent (AR) is distinguishable.

(2.) IN the result, we think that we will be justified in following the case law cited by the learned counsel which covers the present issue in favour of the appellant. In the result, the impugned order is set aside and the appeal is allowed with consequential relief to the appellant.