M/S. Waluj Beverages Pvt. Ltd. Vs. Commissioner of Central Excise and - Court Judgment

Excerpt:
1. the appellants manufacture aerated waters bearing the brand name "bisleri/bisleri club soda". this brand name is owned by m/s. aqua minerals p. ltd. these facts were disclosed in classification list no.2/88 effective from 1.4.1988. this classification list was approved by the jurisdictional assistant collector vide order dated 19.4.1989. in this order the assistant collector traced the history of ownership of the brand name and how the brand name changed hands under certain agreements. he specifically observed that evidence had been given that the brand name owners had an ssi unit in delhi and that their turnover did not exceed rs.1.5 crores. citing certain case law he approved the classification list permitting benefit of notification 175/86 to the present appellants. the jurisdictional commissioner reviewed the approval in terms of the authority vested in him under section 35f(2) of the central excise act, 1944, vide order dated 14.3.1991. based on the same facts the jurisdictional commissioner also issued a show cause notice dated 31.12.1992 demanding differential duty from april, 1988 to march, 1990 on the ground that benefit of the notification was wrongly claimed with intent to evade duty. the allegation made was that the brand name holders were not central excise licensees and had wrongly claimed exemption under the notification. an addendum was issued to the show cause notice in which the claim was made that the brand name owners were not eligible for ssi benefit "since they were not manufacturing any excisable goods at point of time". certain "recent enquiries" were referred to, which were not disclosed. we note that in the review application referred to above also although reference was made to certain "verifications" no disclosure was made as to their content. the assessees argued on merits as well as on limitations. the commissioner, however, confirmed the demand of rs.23,11,686.19 and imposed penalty on the appellants of rs.2,00,000/-.2. shri rohan shah along with shri mohan salian, advocates appeared for the appellants and smt. reena arya, sdr, appeared for the revenue.3. the basis issue is whether the brand name owners were persons eligible for the grand of exemption under this notification, in terms of paragraph 7 of the said notice. the assistant collector in his approval order made a specific observation as to the brand name owner having a unit at delhi. this specific belief has not been countered by the revenue in either of the proceedings i.e. which is before us today and which was before the commissioner (appeals), although a rebuttal of this belief has been made. the answer as per shri shah lies in the tribunal's order in the case of sri ganganagar bottling co. vs. cce 1999 (107) elt 645. this case was identical on facts in which the claim was made that the brand name owners were not eligible of the grant of the benefit in view of the fact that the product manufactured by them namely mineral water, was not excisable. in the absence of any justification and in view of the wording used by the commissioner in the review application we take it that the objection in the present case is also on the same ground. the addendum also states that the brand name holders "were not manufacturing any excisable goods at the point of time". the tribunal in the cited judgment found that mineral water was excisable and that the benefit of the notification was available to the brand name holders. nothing having been shown on the records to distinguish the facts in the present case from those which were before the tribunal in the cited case, we adopt the reasoning and ratio and hold that this appeal succeeds.4. in terms of the narration made by us above, we find that the full facts were disclosed by the assessees in filing their classification list and that the assistant commissioner was on record having been satisfied as to their veracity. in the face of the situation the allegation as to suppression made in december, 1992 and further affirmed by an addendum in october, 1994 does not survive. on limitation also we find merits in the assessees' case.

Judgment:
1. The appellants manufacture aerated waters bearing the brand name "bisleri/bisleri club soda". This brand name is owned by M/s. Aqua Minerals P. Ltd. These facts were disclosed in classification list No.2/88 effective from 1.4.1988. This classification list was approved by the jurisdictional Assistant Collector vide order dated 19.4.1989. In this order the Assistant Collector traced the history of ownership of the brand name and how the brand name changed hands under certain agreements. He specifically observed that evidence had been given that the brand name owners had an SSI unit in Delhi and that their turnover did not exceed Rs.1.5 crores. Citing certain case law he approved the classification list permitting benefit of notification 175/86 to the present appellants. The jurisdictional Commissioner reviewed the approval in terms of the authority vested in him under section 35F(2) of the Central Excise Act, 1944, vide order dated 14.3.1991. Based on the same facts the jurisdictional Commissioner also issued a show cause notice dated 31.12.1992 demanding differential duty from April, 1988 to March, 1990 on the ground that benefit of the notification was wrongly claimed with intent to evade duty. the allegation made was that the brand name holders were not central excise licensees and had wrongly claimed exemption under the notification. An addendum was issued to the show cause notice in which the claim was made that the brand name owners were not eligible for SSI benefit "since they were not manufacturing any excisable goods at point of time". Certain "recent enquiries" were referred to, which were not disclosed. We note that in the review application referred to above also although reference was made to certain "verifications" no disclosure was made as to their content. The assessees argued on merits as well as on limitations. The Commissioner, however, confirmed the demand of Rs.23,11,686.19 and imposed penalty on the appellants of Rs.2,00,000/-.

2. Shri Rohan Shah along with Shri Mohan Salian, advocates appeared for the appellants and Smt. Reena Arya, SDR, appeared for the Revenue.

3. The basis issue is whether the brand name owners were persons eligible for the grand of exemption under this notification, in terms of paragraph 7 of the said notice. The Assistant Collector in his approval order made a specific observation as to the brand name owner having a unit at Delhi. This specific belief has not been countered by the Revenue in either of the proceedings i.e. which is before us today and which was before the Commissioner (Appeals), although a rebuttal of this belief has been made. The answer as per Shri Shah lies in the Tribunal's order in the case of Sri Ganganagar Bottling Co. vs. CCE 1999 (107) ELT 645. This case was identical on facts in which the claim was made that the brand name owners were not eligible of the grant of the benefit in view of the fact that the product manufactured by them namely mineral water, was not excisable. In the absence of any justification and in view of the wording used by the Commissioner in the review application we take it that the objection in the present case is also on the same ground. The addendum also states that the brand name holders "were not manufacturing any excisable goods at the point of time". The Tribunal in the cited judgment found that mineral water was excisable and that the benefit of the notification was available to the brand name holders. Nothing having been shown on the records to distinguish the facts in the present case from those which were before the Tribunal in the cited case, we adopt the reasoning and ratio and hold that this appeal succeeds.

4. In terms of the narration made by us above, we find that the full facts were disclosed by the assessees in filing their classification list and that the Assistant Commissioner was on record having been satisfied as to their veracity. In the face of the situation the allegation as to suppression made in December, 1992 and further affirmed by an addendum in October, 1994 does not survive. On limitation also we find merits in the assessees' case.