1991 (8) TMI 181 - AT - Central Excise

Summary

Issues:
1. Approval of price lists for Welding Electrodes.
2. Inclusion of cost of wooden cases in the assessable value of electrodes.
3. Interpretation of Central Excise law regarding the assessable value and packing costs.

Analysis:
1. The appeal concerned the approval of price lists for Welding Electrodes. The Respondents, manufacturers of various Welding Electrodes, filed a price list claiming abatement of duty on the cost of wooden cases used for packaging. The Asstt. Collector proposed to disallow this claim, stating that wooden cases were essential for transporting the Electrodes and should be included in the assessable value.

2. On appeal, the Collector observed that wooden cases were used for bulk packing of electrodes and were not essential for wholesale trade except for protecting goods during transit. The Tribunal referred to previous judgments and held that the cost of wooden cases should not be included in the assessable value, following the Supreme Court's decision in Godfrey Philips.

3. The Tribunal analyzed the Central Excise law, emphasizing that excise duty is levied on manufactured goods, including the cost of packing in the assessable value. However, only packing necessary for selling goods in the wholesale market at the factory gate should be included. The Tribunal found that the wooden cases used by the appellants were not essential for making the goods marketable and should not be part of the assessable value.

4. The Tribunal rejected the argument that trade practice or the Asstt. Collector's finding should override previous orders, maintaining consistency in assessing the excise duty. The appeal was allowed, directing the Asstt. Collector to exclude the cost of wooden cases from the assessable value of the electrodes.

5. In a separate assent, a Member disagreed with assuming the Department's acceptance of previous orders without explicit evidence of appeal, highlighting the need to consider each manufacturer's trade practices and circumstances individually for assessing packing costs in the excise duty calculation.