1996 (4) TMI 285 - AT - Central Excise

Summary

Issues:
1. Whether duty of wrapping paper used for packing excisable goods should be included in the assessable value of the finished goods.
2. Maintainability of refund claim for excess duty on wrapping paper used as primary packing.
3. Applicability of excise duty on packing materials in determining the assessable value of goods.

Analysis:
1. The appeal raised the issue of whether the duty of wrapping paper used for packing excisable goods should be included in the assessable value of the finished goods. The Collector of Central Excise had affirmed that the duty of wrapping paper should be included. The law specifies that the cost of packing, including excise duty paid on packing materials, is part of the assessable value of goods. Previous decisions by the Tribunal and High Courts support this inclusion, emphasizing that the cost of packing is integral to determining the value of finished goods.

2. The question of the maintainability of a refund claim for excess duty on wrapping paper used as primary packing was also raised. The Asstt. Collector had held that the refund claim was not maintainable. The Tribunal noted that the excise duty on wrapping paper had to be considered in the assessable value of the finished goods, and there was no basis for a refund claim due to the duty already being accounted for in the value calculation.

3. The issue of the applicability of excise duty on packing materials in determining the assessable value of goods was addressed. Section 4(4)(d) of the Central Excises & Salt Act, 1944 specifies that the cost of packing, including excise duty if leviable, is part of the assessable value of goods. The Tribunal cited previous judgments, including decisions by the Supreme Court and High Courts, to support the inclusion of excise duty on packing materials in the assessable value of finished products. The Tribunal also clarified that the availability of proforma credit or Modvat credit for the commodity paper ensures there is no double levy, as manufacturers can avail of benefits under relevant rules.

In conclusion, the Tribunal dismissed the appeal, upholding the decision that the duty of wrapping paper should be included in the assessable value of finished goods, in accordance with relevant legal provisions and precedents. The Tribunal found no error in the Collector's decision and emphasized the importance of considering the cost of packing, including excise duty, in determining the assessable value of goods.