9911796707
|
Home
Issues:
1. Interpretation of deductions on retail price of patent or proprietary medicines for the purpose of determining assessable value for levy of excise duty. 2. Whether excise duty should be deducted before allowing a discount of 25% on the retail price of medicines. 3. Whether sales tax should be deducted if not separately charged. Analysis: 1. The primary issue in this case is the interpretation of deductions on the retail price of patent or proprietary medicines to determine the assessable value for excise duty levy. The petitioner, a manufacturer of proprietary medicines, challenged the method prescribed under clause 8 of the tariff item, which allows a discount of 25% on the retail price specified in the price list. The petitioner argued that excise duty should not be deducted before applying the discount, contending that the price of his medicines has remained constant since 1956, resulting in negligible excise content in the retail price. 2. The petitioner's counsel argued that the explanation in the notification, requiring deduction of excise duty before applying the discount, should be narrowly construed. He relied on the definition of 'value' in the Central Excises and Salt Act, emphasizing that excise duty can only be deducted if separately added to the retail price of medicines. Conversely, the respondent contended that the explanation unambiguously mandates deduction of excise duty before applying the discount, regardless of how it is included in the price list. 3. The court analyzed the contentions and held that the explanation in the notification clarifies that excise duty must be deducted before the 25% discount is applied to the retail price. The court emphasized that including excise duty in the discount calculation would contradict the legislative intent behind the provision. Additionally, the court referred to the definition of 'value' in the Act, which excludes excise duty and other taxes from the calculation, supporting the respondent's interpretation of the deduction process. 4. Another contention raised by the petitioner was regarding the deduction of sales tax, which the respondent had not made. The court noted that the petitioner had not paid sales tax separately and therefore was not entitled to demand its deduction. Consequently, the court dismissed the writ petition, upholding the respondent's method of deduction and rejecting the petitioner's contentions. In conclusion, the court's decision clarified the methodology for determining the assessable value of proprietary medicines for excise duty levy, emphasizing the necessity of deducting excise duty before applying the discount and dismissing the petitioner's claim for sales tax deduction due to non-payment.
|
