Cce, Jaipur-I vs M/S.B.C.Pharma

(Arising out of OIA No.107-108(MPM)CE/JPR-I/06 dt.24.4.06 and OIA No.238-239(MPM)CE/JPR-I/05 dt.4.8.06 passed by the CCE(Appeals), Jaipur-I)

Date of Hearing/Decision 21.09.2015

For approval & Signature:

Honble Smt.Sulekha Beevi C.S., Member (Judicial)

Honble Mr.B.Ravichandran, Member (Technical)

1. Whether Press Reporter may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982? No 2. Whether it would be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not? No 3. Whether their Lordships wish to see the fair copy of the order? seen 4. Whether order is to be circulated to the Department Authorities? yes

CCE, Jaipur-I Appellant

Vs.

M/s.B.C.Pharma Respondent

Shri Pradeep Bajaj, Partner

M/s.Bajaj & Company (India)

Appearance:

Present for the Appellant: Shri S.Mauthuk, JCDR

Present for the Respondent: Shri B.L.Narasimhan, Advocate

Coram: Honble Smt.Sulekha Beevi C.S., Member (Judicial)

Honble Mr.B.Ravichandran, Member (Technical)

Final Order No.52945-52947/2015

Per: Sulekha Beevi C.S.

The above appeals are filed by Revenue against the impugned order passed by Commissioner (Appeals) which set aside the Order-in-Original dated 15.12.2005, ordering the recovery of central excise duty along with interest and also imposed penalty. The issue involved in the above appeals being the same, they were heard together with the cross objections and are disposed by this common order.

2. Brief facts of the case are that respondents were engaged in the manufacture of Ayurvedic medicaments and were clearing their goods as branded as well as unbranded goods. The branded goods were cleared under the brand name Bajaj. They were also availing the SSI benefit of Notification No.8/2003-CE dated 1.03.2003. The department entertained the view that by using the brand name Bajaj in their trade activities, which is a trade mark registered in the name of Sh.Shyam Sunder Bajaj and Sh.Om Prakash Bajaj; the respondents used the trade mark of another person and thus were not eligible for the SSI exemption as per the above notification. The show cause notice issued was adjudicated and the order was passed which confirmed the duty demand with interest and imposed penalty. In appeal, the same was set aside holding that the trade mark Bajaj is a trade mark assigned to respondents by family agreement/Ikararnama and that it is not a trade mark of another person. Aggrieved, the Revenue is before us.

3. The short issue for consideration is whether the trade mark Bajaj used by respondents is a trade mark of another person or whether it is a trade mark assigned to them by family Agreement as contended by them. The use of trade mark of another person would disentitle them from claiming the benefit of SSI exemption. For better appreciation of the issue, the relevant para 4 of the said SSI exemption notification is noticed as under:

The exemption contained in this notification shall not apply to specified goods bearing a brand name or trade name, whether registered or not, of another person.

4. It is not in dispute that the trade mark Bajaj is registered under Trade Mark Act, 1999 in the name of Sh.Shyam Sunder Bajaj and Shri Om Prakash Bajaj. According to respondents Shri Shyam Sunder Bajaj and Shri Om Prakash Bajaj who are brothers executed an Ikararnama/Family Agreement authorizing ten persons to use the trade mark Bajaj. Among the 10 persons, the name of partner of the respondent firm who is the son of Shri Shyam Sunder Bajaj is also included. That therefore respondent became the co-owner of the trade mark. Against this, the argument advanced by the learned DR referring to various provisions of Trade Mark Act was three fold. Firstly that there was no assignment of trade mark to the respondents, but only authorization to use the trade mark. Secondly, as per the deed there was no mention of transfer of ownership of trade mark. Thirdly that the deed is not a registered deed and therefore there is no valid assignment, if any, made.

5. On examination of the Ikararnama, it is seen executed on 25.11.1996 by Shri Shyam Sunder Bajaj and Shri Om Prakash Bajaj giving the right to use the brand name Bajaj to ten persons listed in the Ikararnama. On 9.8.2004 they have further executed a family agreement which according to the parties are to take effect from 25.11.1996, whereby the trade mark is assigned to the 10 persons listed in the Ikararnama. It has also to be stated that the respondent is the son of Shri Shyam Sunder Bajaj who is one among the two in whose name the trade mark is registered. The documents are clear as to the unequivocal intention of Sh.Shyam Sunder Bajaj to assign the trade mark to the 10 persons listed therein. In our view, by such assignment, the respondent has become a co-owner of the trade mark alongwith 9 persons mentioned therein. The mere fact that the assignment was not registered would not alter the position as is laid by the Apex Court, in CCE, Ahmedabad vs. Vishaka Trading & Instrument (P) Ltd., 2003 (157) ELT (SC). We concur with the view of the Commissioner (Appeals) that trade mark Bajaj is a trade mark assigned to respondent and that they have not used trade mark of another person. For the foregoing reason, the issue is answered against the Revenue.

6. In the result, the appeals are dismissed. The cross objections filed by the respondents are also dismissed.

(pronounced in open court)

(B.Ravichandran) (Sulekha Beevi C.S) Member (Technical) Member (Judicial)

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