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2013 (10) TMI 884 - AT - Central ExciseAffixation of MRP - switchgear products i.e. electrical goods such as contractors, relay, pushbutton switches, Moulded Case Circuit Breaker (MCCB), etc. - sale through dealers/distributors - commodities are meant for industrial or institutional consumers - Whether the appellants are required to affix MRP on their product as per the provisions of Standard of Weights and Measures (Packaged Commodities) Rules, 1977 or not Difference of opinion - Held that - matter referred to larger bench with the following issues (1) The demands for the period prior to 1.3.2008 are not sustainable as there was no machinery provisions available to determine MRP of the product. OR The demands for the period prior to 1.3.2008 are sustainable as MRP of the product can be determined by the assessing officer using reasonable/best judgement based upon material available and consistent with principles and provisions of Section 4A of the Central Excise Act, 1944. (1) The demands for the period prior to 1.3.2008 are not sustainable as there was no machinery provisions available to determine MRP of the product. OR The demands for the period prior to 1.3.2008 are sustainable as MRP of the product can be determined by the assessing officer using reasonable/best judgement based upon material available and consistent with principles and provisions of Section 4A of the Central Excise Act, 1944. Whether demand for extended period is not sustainable in law?
Issues Involved:
1. Whether the appellants are required to affix MRP on their products as per the provisions of Standard of Weights and Measures (Packaged Commodities) Rules, 1977. 2. Whether the demands for the period prior to 1.3.2008 are sustainable as there were no machinery provisions available to determine MRP of the product. 3. Whether the list price can be adopted to determine MRP as per the Rule 4(a)(ii) of Central Excise (Determination of Retail Sale Price of Excisable Goods) Rules, 2008. 4. Whether demands for the extended period of limitation are sustainable. Issue-wise Detailed Analysis: Issue No. 1: Requirement to Affix MRP The appellants argued that their products, meant for industrial use, were not subject to MRP affixation under the Standard of Weights and Measures (Packaged Commodities) Rules, 1977. However, the High Court of Bombay in the case of Larson & Toubro Ltd. held that the appellants are required to affix MRP on their goods. The Tribunal upheld this view, noting that the decision of the High Court has not been overturned by the Supreme Court. Therefore, the appellants are required to affix MRP on the impugned goods. Issue No. 2: Demands Prior to 1.3.2008 The appellants contended that demands for the period prior to 1.3.2008 are unsustainable as there were no machinery provisions available to determine MRP. The Tribunal referred to the case of Millennium Appliances India Ltd., which stated that without statutory provisions for determining value, demands cannot be sustained. The Tribunal concurred, holding that demands for the period prior to 1.3.2008 are not sustainable due to the absence of machinery provisions to determine MRP. Issue No. 3: Adoption of List Price as MRP The Tribunal examined whether the list price could be adopted as MRP under Rule 4(a)(ii) of the Central Excise (Determination of Retail Sale Price of Excisable Goods) Rules, 2008. The Tribunal found that the list price forms the basis for transactions between the appellants and their dealers. However, the Tribunal concluded that without evidence of the actual retail sale price, the list price cannot be presumed as MRP. Therefore, the value adopted by Revenue as retail sale price is not sustainable. Issue No. 4: Extended Period of Limitation The appellants argued that they were under the bona fide belief that their goods were meant for industrial use and not subject to MRP affixation. The Tribunal noted that the issue was settled by the High Court of Bombay, and therefore, the extended period of limitation is not invokable. The Tribunal held that the demands for the extended period of limitation are not sustainable. Separate Judgments by Judges: Judge 1: Judge 1 agreed with the conclusions on all issues, holding that the appellants are required to affix MRP on their products, demands for the period prior to 1.3.2008 are unsustainable, list price cannot be adopted as MRP, and demands for the extended period of limitation are not sustainable. Judge 2: Judge 2 disagreed on issues (b), (c), and (d). Judge 2 held that demands for the period prior to 1.3.2008 are sustainable as MRP can be determined using reasonable/best judgment. Judge 2 also held that the list price can be adopted as MRP under Rule 4(a)(ii) of the 2008 Rules. Lastly, Judge 2 held that demands for the extended period of limitation are sustainable due to the appellants' conduct. Conclusion: The Tribunal set aside the impugned orders and allowed the appeals with consequential relief, noting the difference of opinion between the judges and referring the matter to the Hon'ble President for resolution.
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