COMMISSIONER CENTRAL EXCISE, DELHI versus M/S. ACE AUTO COMP. LTD.

COMMISSIONER CENTRAL EXCISE, DELHI versus M/S. ACE AUTO COMP. LTD.

An assessee using the brand name of another, with the intention of indicating a connection with that person, is not entitled to the benefit of the small scale sector exemption under Notification No. 1/93-CE and 16/97-CE, regardless of conjunction with own brand name or customer specificity. In the present case, the use of the 'TATA' brand name by the assessee was intended to indicate such connection and quality as that of Tata Company, disentitling the assessee from exemption.

Parties
Appellant: Commissioner Central Excise, Delhi; Respondent: M/s. Ace Auto Comp. Ltd.
Jurisdiction
India
Judgment Date
16 December 2010
Procedural Posture
Civil Appeal / Appeal From Order of Cegat, New Delhi
Outcome
Appeal allowed
Legal Topics
Central Excise, SSI Exemption Notifications, Brand Name Usage, Exemption Eligibility
Tax Law Central Excise SSI Exemption Notifications Brand Name Usage Exemption Eligibility

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Parties

Commissioner Central Excise, Delhi

Appellant

M/s. Ace Auto Comp. Ltd.

Respondent

Procedural Posture

Civil Appeal / Appeal From Order of Cegat, New Delhi

Legal Issues

  1. 1 Whether SSI exemption under Notification Nos. 1/93-CE and 16/97-CE is available when the assessee uses the brand name of another person on its goods.
  2. 2 Whether use of the brand name 'TATA' by the assessee disentitles it from excise duty exemption for small scale industries.

Ratio Decidendi

An assessee using the brand name of another, with the intention of indicating a connection with that person, is not entitled to the benefit of the small scale sector exemption under Notification No. 1/93-CE and 16/97-CE, regardless of conjunction with own brand name or customer specificity. In the present case, the use of the 'TATA' brand name by the assessee was intended to indicate such connection and quality as that of Tata Company, disentitling the assessee from exemption.

Court Disposition

Appeal allowed

Orders

  • Impugned order of the Tribunal is set aside.
  • Order of the Adjudicating Authority imposing duty and penalty is restored.