2005 (2) TMI 241 - AT - Central Excise

Summary

Issues involved:
Whether the cost of secondary packing is to be included in the assessable value of the goods manufactured by M/s. Triveni Glass Ltd.

Analysis:

The issue in the appeals filed by M/s. Triveni Glass Ltd. pertains to the inclusion of the cost of secondary packing in the assessable value of the goods they manufacture. The appellant's advocate referred to a circular by the Board stating that for glass and glassware, inclusion of packing charges may not be insisted upon in determining the assessable value. However, the Department argued that Section 4 of the Central Excise Act, dealing with the valuation of excisable goods, has been amended, and the Supreme Court has addressed the issue of secondary packing charges in previous cases.

The Tribunal considered the submissions from both sides. Referring to the Supreme Court's test in previous cases, the Tribunal emphasized that the cost of packing should be included if it is necessary for selling the goods in the wholesale market at the factory gate. The Allahabad High Court, in the appellants' own case, held that secondary packing is essential for selling glass sheets in the wholesale market efficiently. Therefore, the cost of secondary packing is deemed includible in the assessable value of the sheet glass. The Tribunal concluded that the Board's Circular is not applicable due to changes in Section 4 since 1975 and the decisions of the Supreme Court and the High Court in this matter. Consequently, both appeals were rejected based on the judgment of the Allahabad High Court and the legal principles established by previous court decisions.