The Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Chennai has held that use of common/assigned brand names does not bar Small Scale Industry (SSI) exemption benefit.
The bench of Mr. P. Dinesha (Judicial Member) and Vasa Seshagiri Rao (Technical Member) that the use of brand names “GANGA”, “NATIONAL” and “SHINGHVI” on gas lighters could not be considered as use of another person’s brand name so as to deny the SSI exemption.
The appellant, Aashish Enterprises, a proprietary concern engaged in manufacturing electronic gas lighters under Chapter Tariff 96138010, had been availing SSI exemption. The department alleged that the firm manufactured and cleared gas lighters using brand names belonging to others—specifically Ganga, National, and Shinghvi—during 2005–06 to 2009–10, and therefore was not entitled to SSI exemption.
Following investigations, a duty demand of Rs. 12,35,906, along with interest and penalty under Section 11AC, was confirmed by the adjudicating authority and later upheld by Commissioner (Appeals).
The firm challenged the order before CESTAT.
The Appellant argued that the brand names used were either common names or assigned legally to the appellant. The department failed to prove exclusive ownership of the brand by any other entity. Reliance was placed on CBIC Circular No. 52/52/1994 and the Tribunal’s ruling in Ample Industries (2007), which held that SSI exemption cannot be denied where brand names are generic or free-use brands.
The department contended that statements collected during investigation suggested the brands belonged to other parties. The alleged transfer/assignment of the brand “National” was still under process and thus inapplicable.
The Tribunal observed that no evidence was produced to show ownership by any particular person; department did not verify ownership claims. The name was considered generic. A deed of assignment dated 18.04.2005 transferring rights to the appellant existed prior to the period under dispute. This constituted valid ownership transfer. Considered a surname / common trade name, and no evidence established exclusive proprietary ownership by anyone else.
The Bench relied on precedents, including Pethe Brake Motors Pvt. Ltd. and Ample Industries, confirming that SSI exemption cannot be denied merely because a brand name is used unless it is clearly proved to belong to another person and is used to derive market advantage.
“We have no hesitation to hold that the appellant is eligible for the benefit of SSI exemption… the entire demand is not sustainable and ordered to be set aside,” CESTAT ruled.
The tribunal quashed the demand of ₹12.35 lakh, along with interest and penalty, has been set aside. SSI exemption under Notification No. 8/2003-CE has been held applicable. The Tribunal did not find it necessary to examine limitation once the demand failed on merits.
Case Details
Case Title: M/s. Aashish Enterprises Versus Commissioner of GST and Central Excise
Case No.: Excise Appeal No. 42303 of 2016
Date: 30.10.2025
Counsel For Appellant: G. Natarajan, Advocate
Counsel For Respondent: M. Selvakumar, Authorised Representative
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