2005 (2) TMI 177 - AT - Central Excise

Summary

Issues involved: Interpretation of exemption under Rule 34 of Standards of Weights and Measures Act, 1976 for goods not intended for retail sale under Section 4 of the Central Excise Act.

Summary:
The case involved the appellants engaged in manufacturing products falling under Chapter heading 8536.90 of Central Excise Tariff, which were brought under MRP base levy under Section 4-A of the Central Excise Act, 1944. The dispute arose when show cause notices were issued for demanding duty under Section 4A of the Act.

The appellants contended that the goods were not for retail sale but for exclusive use by industries as raw material, thus exempted under the Standards of Weights and Measures Act, 1976. On the other hand, the Revenue argued that the goods were sold directly to industrial consumers and through dealers, packed with details for retail sale, hence assessable under Section 4A of the Act.

The Tribunal found that the goods were not challenged in terms of classification, but the key issue was whether they were intended for retail sale. Rule 34 of Standards of Weights and Measures Act (Packaged Commodities) Rules, 1997 provides exemption for packages exclusively for industrial use. Each package in question was clearly marked for industrial use only, not for retail sale, and the Revenue failed to prove otherwise. Consequently, the Tribunal ruled in favor of the appellants, setting aside the impugned orders and allowing the appeals.