1987 (7) TMI 322 - AT - Central Excise

Summary

Issues Involved:

1. Classification of Apple Juice Concentrate under Central Excise Tariff.
2. Inclusion of the value of returnable carboys in the assessable value.
3. Validity of the demand for differential duty.

Summary:

Issue 1: Classification of Apple Juice Concentrate under Central Excise Tariff

The primary issue was whether the apple juice concentrate packed in returnable plastic carboys should be classified under Tariff Item 1B or Item 68 of the Central Excise Tariff. The Assistant Collector initially dismissed the appellants' plea that the goods should be classified under Item 68, considering that the carboys were returnable and did not contain a fixed quantity. The Appellate Collector, however, held that the goods were not classifiable under Item 1B because they were sold in a loose condition, and the carboys were returnable. The Tribunal, agreeing with the Appellate Collector, concluded that the apple juice concentrate sold in carboys did not meet the criteria of "prepared or preserved foods put up in unit containers" as per Item 1B, and thus should be classified under Item 68.

Issue 2: Inclusion of the Value of Returnable Carboys in the Assessable Value

The second issue was whether the cost of the durable and returnable carboys should be included in the assessable value of the apple juice concentrate. The Appellate Collector ruled that the value of such carboys should not be included in the assessable value as per Section 4(4)(d)(i) of the Central Excises and Salt Act, 1944. The Tribunal upheld this view, stating that even if the goods were classified under Item 1B, the statutory provisions of Section 4(4)(d)(i) would prevail, excluding the cost of durable and returnable packing from the assessable value.

Issue 3: Validity of the Demand for Differential Duty

The department argued that the respondents had suppressed material information by not declaring the containers separately in the invoices or price lists, thus invoking the extended period for raising the demand for differential duty. However, the Appellate Collector found the appellants' plea of limitation valid, as they had duly filed the price lists declaring the product as being sold loose in durable PVC containers. The Tribunal agreed with this finding, leading to the dismissal of the department's appeals regarding the differential duty demands.

Separate Judgement by Judge

The President, Shri S. Venkatesan, resolved the points of difference between the members of the original bench, concluding that the apple juice concentrate should be classified under Item 68, and the value of the durable and returnable carboys should be excluded from the assessable value. Consequently, the appeals were dismissed.