2019 (8) TMI 425 - AT - Central Excise

Valuation of goods - Odomos Mosquito Repellant Cream supplied to Armed Forces - contention of the department is that the MRP applicable to sale of the goods in open market should be applied even in case supplies made to Armed Forces - Section 4A on Central Excise Act, 1944 - HELD THAT - The issue decided in appellant own case M/S DABUR INDIA LTD. VERSUS C.C.E. S.T. -VAPI 2018 (5) TMI 1510 - CESTAT AHMEDABAD where it was held that valuation should be done under Section 4 in respect of goods supplied to Armed Forces/ Para Military Forces for their use only and there is no re-sale of the goods. The impugned order is set aside appeals are allowed by way of remand to the adjudicating authority to decide a afresh in the light of the judgment in the appellants own case - Appeal allowed by way of remand.

Summary

Issues Involved:
Valuation of goods supplied to Armed Forces under Section 4A of Central Excise Act, 1944.

Analysis:

Issue 1: Valuation of goods supplied to Armed Forces under Section 4A

The appellant, engaged in the manufacture of Odomos Mosquito Repellant Cream supplied to Armed Forces, valued the goods based on Maximum Retail Price (MRP) under Section 4A of the Central Excise Act, 1944. The department contended that the MRP applicable to open market sales should also apply to supplies made to Armed Forces, leading to a demand for differential duty. The appellant's counsel referred to a previous case involving M/s. Dabur India Ltd, where the valuation for goods supplied to Armed Forces was determined under Section 4, emphasizing that no re-sale of the goods occurred. The counsel argued that a re-quantification of duty would be necessary even if valuation is done under Section 4. The Revenue representative did not object to remanding the matter for a fresh decision.

Analysis 1:
The Tribunal, considering the judgment in the case of M/s. Dabur India Ltd, which settled a similar issue, decided to set aside the impugned order and remand the appeals to the adjudicating authority for a fresh decision. It was emphasized that the facts should be verified in light of the cited judgment, indicating a shift in the valuation method for goods supplied to Armed Forces. The decision highlights the importance of consistent application of valuation principles, especially concerning goods supplied to specialized entities like the Armed Forces.

Conclusion:
The judgment underscores the significance of applying appropriate valuation methods for goods supplied to specific entities like the Armed Forces. By setting aside the previous order and remanding the case for a fresh decision, the Tribunal ensures that the valuation process aligns with established legal precedents, promoting consistency and fairness in excise duty assessment for such transactions.