Advocates Appeared:
Prantosh Mookherjee,T. Premkumar, R.K. Roy

ORDER

Per Smt. Archana Wadhwa :

As both the appeals are against the same and common impugned Order passed by the Commissioner of Central Excise, Calcutta-I, the captioned two appeals are being disposed of by a single Order. Briefly stated the facts of the case are as under:-

1.1. The first appellant firm namely M/s. Emkay Investments Private Limited, is engaged in the manufacture of plywood classifiable under Sub-Heading: 4408.90 of the Schedule Act, 1985. The appellants' factory was visited by the Central Excise Officers who found that the appellants are also using the brand/logo - 'MERINO' - along with the brand-name - "Pelican" - on the plywood being manufactured by them. As such the Officers entertained a view that as the logo of "MERINO" is also being shown on the plywood being manufactured by them, apart from their own logo of "Pelican" and as the owner of the brand, "MERINO" i.e. M/s. Merinoply and Chemicals Ltd., is a large-scale manufacturer of plywood not entitled to the benefit of small-scale exemption Notification No. 175/86-CE dated 1.3.86, as amended, the appellants were also not entitled to the benefit of the said exemption Notification in view of para 7 of the same. Accordingly, seizure of 738 pieces of commercial plywood was effected by the Officers on 9.3.91. The Officers also visited the premises of the purchasers of the said plywood and seized the material found in their premises. The second appellant firm, M/s. Plyking is one of the traders from whose premises plywood valued at Rs. 3847.72 was seized by the Officers.

1.2. On adjudication, the Commissioner of Central Excise, Calcutta-I vide his impugned Order held that the logo indicating "MERINO" in a specific manner was the brand-name used by M/s. Merinoply and Chemicals Ltd. who were not eligible for the grant of benefit of Notification No. 175/86 and as such, denied the benefit to the first appellant firm and accordingly, confiscated the seized plywood totally valued at Rs. 34,849.59 and appropriated an amount of Rs. 3659.20 towards the duty, Rs. 9,340.80 towards the redemption fine and Rs. 10,000.00 towards the penalty from the Cash Security given by the appellants at the time of provisional release of the goods.

1.3. He also confiscated 223 pieces of plywood totally valued at Rs. 13,509.80 seized from the business premises of M/s. Plyking and ordered appropriation of Rs. 1,172.28 towards the Central Excise Duty of Rs. 3,827.72 towards fine and Rs. 4,000.00 towards the penalty, from the cash security given by the appellant firm at the time of provisional release of the goods.

2. We have heard Shri Prantosh Mookherjee, learned Advocate for the appellants and Shri T. Premkumar, learned S.D.R. for the Revenue in the first case i.e. E-246/92 and Shri R.K. Roy, learned J.D.R. in the second case i.e. E-279/92.

3. The dispute in the instant cases is as to whether the appellants who are manufacturers of plywood under their own brand-name, M/s. Pelican have made themselves disentitled to the benefit of small-scale exemption Notification No. 175/86 by using a logo indicating - "MERINO" - on their products along with their brand-name. It has been the appellants' case that though the word - "MERINO" - is written in the same style as written on the plywood manufactured by M/s. Merinoply and Chemicals Ltd., nevertheless the same will not imply any relation of goods by the appellants under the brand-name of "MERINO". They submitted that the brand-name of M/s. Merinoply and Chemicals Ltd. is "TUFFPLY" and "MERINO". They have argued that the learned Commissioner in para 9.3.7 of the impugned Order has denied them the benefit of the said Notification on the ground that they have written the word - "MERINO" - on their own product, regardless of the fact that such product was affixed also with the brand-name of the S.S.I. manufacturer, the said company in this case.

4. The Departmental Representatives have countered the arguments of the appellants by arguing that "MERINO" is the brand-name and logo registered and owned by M/s. Merino Plywood and the affixation of the same on the product would disentitle the appellant firms from the benefit of Notification in terms of para 7 read with Explanation VIII as M/s. Merinoply being a large-scale unit, are not entitled to the exemption Notification No. 175/86, para 7 would be attracted and the appellant firms would become ineligible for exemption. He has also relied upon the Tribunal's decision in the case of Inter-City Cable System Vs. Collector of Central Excise, Delhi reported in 1995 (11) RLT 170 (T) = 1995 (80) ELT-445 as also on the Madras High Court's Judgement in the case reported in 1995 (78) ELT-404.

5. We find that this is not a case where the product in question is being affixed with the brand-name of the other person. From the facsimiles of the brand-name/logo put on the goods in question, we find that the brand-name, "PELICAN" along with a logo - `encircled Bird' - has been prominently put on the goods. It is only between the two words - `PRODUCT' and `GROUP' that it is written by small letters - "MERINO" - and in the same style in which it is written on the plywood manufactured by M/s. Merino Plywood & Chemicals Ltd. A xerox copy of the said facsimiles of the brand-name/logo as annexed to page 78 of the paper-book is reproduced on the next page.

6. The question which arises is as to whether these markings or inscriptions should be considered as the brand-name of M/s. Merinoply and will come within the mischief of Clause 7 read with Explanation VIII of the Notification, as contended by the Department. The reproduction of Clause 7 reads as follows :-

"The exemption contained in this Notification shall not apply to the specified goods where a manufacturer affixes the specified goods with a brand name or trade name (registered or not) of another person who is not eligible for the grant of exemption under this notification."

Explanation VIII reads as follows:-

"`Brand name' and `trade name' shall mean a brand name or trade name, whether registered or not, that is to say a name or a mark, such as symbol, monogram, label, signature or invented word or writing is used in relation to such specified goods for the purpose of indicating, or so as to indicate, a connection in the course of trade between such specified goods and some person using such name or mark with or without any indication of the identity of that person."

7. What should constitute a brand-name or a trade name has got to be gleaned by looking at the Explanation VIII. It is seen that the said Explanation does not make a registration or otherwise of the brand-name or trade-name, a relevant factor. It is not sufficient to find a portion of the symbol or monogram of the other person on the product to oust them from the benefit of Notification or to bring the goods within the ambit of Explanation VIII. As held by the Honourable Madras High Court in the case of B.H.E.L. Ancillary Association Vs. Collector of Central Excise reported in 1990 (49) ELT-33 (Mad.), mere affixation of the symbol on the goods is not sufficient and something more is required by Explanation VIII. The marking used on the product must be for the purpose of indicating or so as to indicate a relation in the course of trade between such specified goods and the person owning such name or markings. By a comparison of the markings as reproduced above, we find that the same are entirely different except the use of the word - "MERINO" in between the appellants' own brand name. The appellants' brand-name, "PELICAN" has been clearly marked and their logo in the shape and style - `encircled Bird' - has been put on the product. Comparing the same with the markings put on their plywood by M/s. Merinoply Plywood and Chemicals Ltd., we find that apart from writing the word, "MERINO" in a style, the said marking also uses the word, `TUFFPLY' which is the brand-name of M/s. Merino Plywood and Chemicals Ltd. Below the same, pictures of Boiling Water and Termite working on wood and sun, have been placed to indicate that the ply in question is boiling water-proof, termite-proof and weather-proof. We do not find any such markings on the products manufactured by the appellant firm. We observe that the brand-name as defined in Explanation VIII of the Notification must create an impression in the mind of the purchaser that the product is that of M/s. Merinoply; that the use of markings as indicated above by the appellants, cannot be said to indicate any connection in the course of trade between such specified goods and M/s. Merino Plywood and Chemicals Ltd.

8. We also take note of the fact that the Commissioner in his impugned Order has observed that the appellants have also used their own brand-name. The appellants' brand-name of M/s. Pelican is more prominently displayed on the plywood and immediately striking the idea of relation with Pelican brand to the persons purchasing the goods rather than the small symbol of 'MERINO' used in a less prominent way on the goods. Accordingly, we hold that the appellants are entitled to the benefit of the Notification and allow the appeal of the first appellant namely, M/s. Emkay Investments Private Limited.

9. As the first appellants' appeal has been allowed, the appeal of the second appellant firm namely, M/s. Plyking, who a mere trader, is also allowed. The impugned Order is set aside with consequential reliefs to both the appellants.