2023 (11) TMI 301 - AT - Central Excise

Method of Valuation - physician sample to be in accordance with Rule 8 or Rule 4 of the Central Excise (Valuation) Rules, 2000? - HELD THAT - The Hon ble Supreme Court in MEDLEY PHARMACEUTICALS LTD. VERSUS THE COMMISSIONER OF CENTRAL EXCISE 2011 (1) TMI 13 - SUPREME COURT has held that physician samples have to be valued on pro-rata basis for the relevant period. The impugned order is upheld and the appeal being devoid of merit, accordingly is dismissed.

Summary

Issues involved: Valuation of physician samples under Central Excise Act, 1944.

Summary:

Issue 1: Valuation of physician samples

The appeal was filed against the Order-in-Appeal No. 29/2011 dated 17.3.2011 regarding the valuation of physician samples under Chapter Sub Heading 3003.10.00 of Central Excise Tariff Act, 1985. The appellants cleared physician samples by discharging duty @ 110% of the cost of production, which was challenged by the Revenue. Show-cause notices were issued demanding differential duty for the period from October 2007 to May 2008. The Revenue argued that valuation should be done u/s 4 of Central Excise Act, 1944 read with Rule 4 of the Central Excise (Valuation) Rules, 2000. The learned AR for the Revenue cited recent judgments to support this contention.

Issue 1 Judgment:

The Tribunal considered the recent judgment in the case of M/s. Amazon Drugs Pvt. Ltd. Vs. CCE, Bangalore, and the principle established by the Larger Bench of the Tribunal and the Hon'ble Supreme Court. It was held that physician samples should be valued on a pro-rata basis as per the law laid down by the Supreme Court. The Tribunal followed the precedent set in the Amazon Drugs Pvt. Ltd. case and upheld the impugned order, dismissing the appeal for lack of merit.