M/S MEGHRAJ BISCUITS INDUSTRIES LTD. versus COMMISSIONER OF CENTRAL EXCISE, U.P.

Citation: [2007] 3 S.C.R. 1003 · Decided: 14-03-2007 · Supreme Court of India · Bench: S.H. KAPADIA · Disposal: Dismissed

Judgment (excerpt)

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. j 
A 
M/S. MEGHRAJ BISCUITS INDUSTRJES LTD. 
v. 
COMMISSIONER OF CENTRAL EXCISE, U.P. 
MARCH 14, 2007 
B 
[S.H. KAPADIA AND B. SUDERSHAN REDDY, JJ.] 
J 
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Central Excise Act, 1944-SSI Notification-Exemption under-
Entitlement of-Assessee-manufacturer of biscuits, selling it under Brand c 
name M since 1991-Revenue's case that assessee using registered trade 
mark of another manufacturer, thus, not entitled to exempiion-Held: Under 
the Notification, exemption not available for excisable goods bearing brand 
name, registered or not, of another persorr-Assessee did not satisfj; the 
Authority that there was no intention of indicating connection with the D 
goods of other person, and that the other manufacturer had abandoned the 
Trade Mark-Further, grant of registration certificate to assessee under the 
.I 
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Trade Marks Act in year 2000 would not entitle him to exemption-
Retrospective effect cannot be given to issuance of registration certificate on 
the principle of deemed equivalence-Thus, assessee not entitled to 
exemption-Notification no. 1198 CE dated 28.2.1993 (as amended)-Trade E 
Marks Act, 1999--Section 28. 
Appellants-manufacture of biscuits, sold the biscuits under the brand 
name M. Department issued notice to the appellants that they were not eligible 
to the exemption under the SSI Notification No.1/93-CE (as amended) since 
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M was a registered trade mark of KAB who were using it on manufacture of 
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biscuits themselves; and as such demanded differential duty. It was Revenue's 
case that KAB and RFP entered into an agreement under which KAB gave 
permission to RFP to use its trade mark for the manufacture of wafers alone 
for three years from 22.11.1989. Appellants contended that they started 
manufacturing biscuits in 1991 an~ sold it in wrapper mentioning Mon it G 
and since then the use of brand name M was never challenged. Assistant 
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Commissioner held that the appellants were not entitled to the benefit. 
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Appellants-assessee filed appeals. Commis5ioner dismissed the same since 
the appellants were using the brand name M of another manufactur'1 KAB 
1003 
H 
1004 
SUPREME COURT REPORTS 
[2007) 3 S.C.R. 
A on their products (biscuits); and that the word M was printed on all the printed 
wrappers and as such was using the brand name Mon its products, thus, were 
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not entitled to exemption. Tribunal upheld the Orders. Thereafter, appellants 
filed application for Rectification. During pendency of the Rectification 
Application, the Registrar of Trade Marks issued Registration Certificate 
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registering the trade mark Munder Trade Marks Act, 1999 in favour of the 
appellants and the same was mentioned before the tribunal Tribunal dismissed 
the Rectification Application. Hence the present appeals. 
Dismissing the appeals, the Court 
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HELD: 1.1. The object of the Notification No.1/93-CE dated 28.2.1993 
(as amended) was to help the SSI Units to survive in the market dominated by 
brand name/trade name and thereby increase industrial production. Under 
para '4' of the Notification, the benefit of exemption was not available for 
excisable goods bearing brand name or trade name (registered or not) of 
another person. The object of the exemption Notification was neither to protect 
D the owners of the trade mark nor the consumers from being misled. These 
are considerations which are relevant in disputes arising out of infringement/ 
passing of actions under the Trade Marks Act. The object of the Notification 
is to grant benefits only to those industries which otherwise do not have the 
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advantage of a brand name. (Paras 7 and 11) (1009-E-F; 1011-A-C) 
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1.2 It is clear that grant of registration certificate under the Trade 
Marks Act will not automatically provide benefit of exemption to the SSI Unit. 
(Para 121 (1011-DI 
Pahwa Chemicals Pvt. Ltd. v. Commissioner of Central Excise, Delhi, 
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(2005) 189 EL T 257 SC, relied on. 
2.1. There was no evidence to show as to whether KAB was an "eligible 
" 
manufacturer". No explanation was given as to why Director of KAB has not 
been examined by the appellants. He was examined even on the question of 
alleged transfer of the trade mark in favour of appellants. In the 
G circumstances, there is no merit in this appeal. (Para 91 (1010-D-EI 
2.2. MY-common Director in the appellant company and KAB filed an 
affidavit enclosing the registration certificate, but did not state as to on what 
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basis, in the Agreement sign

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