SUPREME COURT OF INDIA

Before:- Ruma Pal, Arijit Pasayat and C.K. Thakker, JJ.

Civil Appeal Nos. 14-16 of 2000. D/d. 17.3.2005.

Super Delicacies (P) Ltd. - Appellant

Versus

Commissioner of Central Excise, New Delhi - Respondent

Excise - Exemption from excise - Whether the appellant is entitled to the benefit of Notification No. 175/86-CE dated 1.3.1986 which granted exemption to small-scale industries - Merely because the owner of the brand name manufactures goods which are exempt from excise duty does not mean that such owner is entitled to the benefit of the notification - Notification expressly states that the use of brand name belonging to third party is permitted only if such other person is liable for grant of exemption under the notification.

[Paras 4 and 6]

ORDER

Ruma Pal, J. - The question in these appeals is whether the appellant is entitled to the benefit of Notification No. 175/86-CE dated 1-3-1986 which granted exemption to small-scale industries. The appellant manufactures dant manjan under the name and style of M.D.H. That brand name is admittedly owned by M/s. Mahashiyan Di Hatti Pvt. Ltd. According to the appellant, the appellant was using the brand name under an agreement with the owner whereunder the appellant was liable to pay royalty by way of consideration for such use. The owner of the brand name itself does not manufacture dant manjan but manufactures masalas.

2. The notification in question permits small-scale industries certain benefits provided, inter alia, they do not use the brand name of someone else who is not entitled to exemption under the notification. The owner of the brand name was not paying any excise duty during the period prior to 24-1-1989 on the ground, according to the appellant, that the goods manufactured by the owner were exempt. The owner, however, was not registered as a small-scale industry till 24-1-1989.

3. Four show-cause notices were issued to the appellant, the particulars whereof are as under:

Date of notice	Period
28-11-1988	1-5-1988 to 31-10-1988
6-12-1988	1-10-1987 to 30-5-1988
30-1-1989	1-11-1988 to 3-12-1988
3-8-1989	1-4-1989 to 10-5-1989

4. The Assistant Collector, the Commissioner (Appeals) and the Customs, Excise and Gold (Control) Appellate Tribunal (CEGAT) have all held that the appellant was not entitled to the benefit of the notification on the ground that during the period in question the owner was not entitled to the benefit of the notification and that admittedly the appellant had been using the brand name belonging to the owner.

5. Before us, the appellant has conceded that it would not press the argument which had been canvassed in the fora below that the notification did not serve to exclude cases where the brand owner manufactured different goods. What has been argued is that the appellant must be granted the benefit of the notification on the assumption that the owner was not in fact liable to pay excise duty for the period in question and furthermore was in fact a small-scale industry.

6. We are unable to accept this contention. Merely because the owner of the brand name manufactures goods which are exempt from excise duty does not mean that such owner is entitled to the benefit of the notification. The notification expressly states that the use of brand name belonging to a third party is permitted only if such other person is liable for grant of exemption under the notification. We are also unable to assume that the owner, merely because it was granted registration on 24-1-1989, would have been a small-scale industry during the period in question. Apart from the fact that the owner was in fact not so registered, this Court cannot be called upon to enter into an enquiry whether the owner was in fact a small-scale industry during the period in question.

7. In the circumstances, the appeals are, accordingly, dismissed but without any order as to costs.

Appeals dismissed.