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2014 (2) TMI 1049 - AT - Central ExciseValuation - Show cause Notice was issued on 06.09.1984 demanding duty in respect of recorded copies on the ground that M/s Gramophone Company of India Ltd are holding copyright of the programme recorded by the respondents - Respondents have no right to sell to any other party other than M/s GCIL - Therefore, Revenue held that Respondents are liable to pay duty on the price at which M/s GCIL is selling the tapes manufactured by the Respondents to their dealers - Held that - In the Show Cause Notice, the allegation is that M/s GCIL are the manufacturers as per the provisions of Section 2(f) of the Central Excise Act. In a similar situation we find that the Tribunal in the case of Collector vs Music India Ltd (supra) held that the buyers price to their own sellers cannot be the basis for determination of assessable value at the hands of the assessee who undertakes the activity of recording the audio cassettes - in the Show cause Notice there is a specific averment that M/s GCIL is the manufacturer and the present Respondents are liable to pay duty on the price at which M/s GCIL is selling. In case M/s GCIL is to be treated as manufacturer then the Respondents are not liable to pay any duty - Decided against Revenue.
Issues:
1. Appeal against dropping a demand for duty. 2. Determination of manufacturer under Central Excise Act. 3. Assessment of duty based on price charged by copyright holder. 4. Application of principles from previous judgments. 5. Interpretation of assessable value for duty payment. Analysis: 1. The appeal was filed by the Revenue against the dropping of a demand of Rs. 3,11,049/- by the Commissioner (Appeals) for the period May 1983 to February 1984. 2. The case revolved around whether the Respondents, engaged in manufacturing audio cassettes, were liable to pay duty based on the copyright ownership and the role of M/s Gramophone Company of India Ltd (M/s GCIL) as the manufacturer under Section 2(f) of the Central Excise Act, 1944. 3. The Revenue contended that the Respondents could only sell to the copyright holder, making the price charged not the normal price under Section 4 of the Central Excise Act. They argued that the copyright holder should be considered the manufacturer, thus duty should be paid based on their selling price to dealers. 4. The Respondents argued that the matter had been remanded twice by the Tribunal for fresh consideration, citing the principles from the case of Ujagar Prints. They also referenced a Tribunal decision in Collector vs Music India Ltd to support their position against the demand. 5. The Tribunal found that the Show Cause Notice alleged M/s GCIL as the manufacturer, leading to the duty calculation based on their selling price. However, following the precedent set in Collector vs Music India Ltd, it was held that the buyers' price to their sellers cannot determine the assessable value for the Respondents. 6. Ultimately, the Tribunal dismissed the appeal, emphasizing that if M/s GCIL is considered the manufacturer, the Respondents would not be liable to pay duty. The decision was based on the specific averment in the Show Cause Notice regarding the manufacturer status and the price at which M/s GCIL was selling. This detailed analysis covers the issues raised in the legal judgment comprehensively, outlining the arguments presented by both parties and the Tribunal's reasoning leading to the dismissal of the appeal.
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