Commissioner of C. Ex. Vs. Malabar Oxygen Pvt. Ltd.

1. In all these revenue appeals, the common question of law and facts are involved. Hence they are taken up for disposal as per law. The respondent assessee are manufacturers of gases like Oxygen nitrogen and filling the same in cylinders in terms of the provisions of Gas Cylinder Rules, 1981. They are required to mark the cylinders with their company's name for identifying the cylinders. The department initiated proceedings invoking larger period on the allegation that they have used the brand name and hence are not eligible for the benefit of Notification No. 175/86, 1/93. The Commissioner after due consideration of the matter in the light of several judgments of the Apex Court, High Court and the Tribunal noted in his order, has decided the case in the assessee's favour both on time bar as well as on merits of the case. The findings recorded by him in paras 13 to 17 are reproduced herein below: "13. I have carefully considered the appeal memorandum and the detailed submission made on behalf of the appellants as summed up in paragraphs 2 to 12 above. The arguments advanced by the appellant's representative indeed have considerable force. It is evident from the materials produced before me that the embossing on the cylinders supplied by the buyers is in pursuance of the Gas Cylinder Rules, 1981 and this practice is adopted uniformly by the industry as a whole. Beyond the indication of the name of the cylinder owner and the responsibility to mark the same in fulfilment of Gas Cylinder Rules embossing of the name of the supplier does not serve any indicative purposes. The markings found on the cylinders supplied by the buyers do not represent the brand name of the buyers and by no stretch of imagination, it can be held that the said markings presents an indication as to "the 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." Thus on the basic issue, I am of the view that the case of the appellant is not one of manufacturing and supplying gases bearing the brand name of any other person. Accordingly, the denial of the Central Excise duty exemption under Notification No. 175/86, 1/93 and successor notifications on the ground that the appellant was affirming the brand name of any other person is not sustainable.

14. The ratio of the judgment of the Hon'ble Supreme Court in the case of Astra Pharmaceutical Limited v. C.C.E., as reported in 1995 (75) E.L.T. 214 would also be applicable to the present case.

15. The Original Authority has, on the other hand, relied upon the decision of the Hon'ble Tribunal in the case of Cochin Soft Drinks v. C.C.E., reported in 1996 (86) E.L.T. 275. The facts of the case are quite different from the present one inasmuch as the markings in the case of soft drinks clearly connotes to the buyer of the soft drink a known brand name indicating the link between product and the brand owner. It is not the same case herein as the markings are basically in compliance of the requirements under the Gas Cylinder Rules and the same do not constitute any brand name or trade name.

16. The arguments advanced by the appellants in regard to applicability of Section 11A and 11AC are also equally valid.

17. In view of the findings as above, I set aside the Order-in-Original bearing Nos. (1) C. No. V/28/15/4/97 (B.III) (Order No. 9/97) dated 8-12-1997/ 17-12-1997 passed by Additional Commissioner of Central Excise, Bangalore-III Commissionerate (2) C. No. V/28/15/4/97 C.I (B.III) Order No. 9/97 dated 8-12-1997/17-12-1997 passed by Additional Commissioner of Central Excise, Bangalore III Commissionerate. (3) C. No. V/28/3/176/96 B.III) (Order No. 39/98 AC) dated 27-2-1998/20-3-1998 passed by Assistant Commissioner of Central Excise, Mangalore. (5) C. No. V/28/3/80/98 B.1(B) Order No 96/98 AC dated 29-9-1998/22-10-1998 passed by Assistant Commissioner of Central Excise, Mangalore. The penalty imposed upon the appellant as well as Shri Vallabh P. Pai, Foundekar, are also set aside. The appeals are allowed in full with consequential benefits." 2. We have heard learned SDR Shri L. Narasimha Murthy who argued the matter in terms of the report filed by the Revenue in the matter and learned counsel Shri S. Raghu. We have also gone through various grounds made out in his appeal.

3. After due consideration, we are of the considered opinion that the Order passed by the Commissioner in the impugned Order is legal and correct in terms of law. There is no infirmity in the same. The appellants have not affixed any brand name on the gas cylinders in terms of the Gas Cylinder Rules, 1981. The appellants are required to mark the cylinders with the name of their company for the purpose of identification. We have gone through the Gas Cylinder Rules, 1981 wherein a specific provision have been made for marking and labeling of Company's name on the gas cylinders for the purpose of identification.

Merely because the appellants are marking cylinders with their company's name by itself cannot be considered as affixing the brand name. The Commissioner has correctly analysed the facts of the entire case and has correctly noted the provisions of law and has rightly held that merely because the assessee has affixed their name in terms of the Gas Cylinder Rules, 1981 by itself can not be held that they have affixed the brand name. The assessees have not affixed any brand name even in terms of the Apex Court judgment rendered in the case of as reported in 1995 (75) E.L.T. 214. The affixing of Company's name cannot be considered as affixing a brand name or trade name. This judgment clearly apply to the fact of the case. There is no merit in these appeals and the same are rejected.