1996 (5) TMI 259 - AT - Central Excise

Summary

Issues:
1. Availment of benefit of Notification 245/83.
2. Interpretation of Clause (iii) of the proviso.
3. Approval of price lists under Drug Price Control Order.
4. Assessment under Section 4 vs. benefit of Notification 245/83.
5. Discretion of the appellant in choosing the mode of assessment.

The judgment concerns the appeal regarding the availment of the benefit of Notification 245/83, which exempts certain medicines from excise duty. The issue revolves around Clause (iii) of the proviso, which states that the exemption shall be allowed only if the manufacturer claims it for all medicines cleared by them under the Price Control Order. The appellants had filed separate price lists for medicines manufactured as a loan licensee and those manufactured directly, seeking abatements under Section 4 for the latter. The lower authority held that the appellants must avail the notification's benefit for all medicines falling under the Price Control Order. The absence of representation for the appellants led to a direct disposal of the appeal on merits.

The Respondent argued that the appellants should have availed the benefit of Notification 245/83 for all medicines, based on the lower authority's decision. The Respondent contended that the demand for duty was valid despite the appellants paying under protest. The appellants, on the other hand, claimed that their price list was not yet approved, and they had paid duty based on previous approvals, questioning the demand's validity.

The Tribunal analyzed the situation and emphasized that the notification provides the appellant with the option to choose between availing the exemption or claiming abatements under Section 4. The Tribunal noted that the appellants had not finalized their price lists, and the demand was based on the assumption that all assessments should be done under Notification 245/83. The Tribunal clarified that the appellants cannot be compelled to claim the exemption and that they have the right to choose the mode of assessment that benefits them. Therefore, the lower authority's decision was deemed legally unsustainable, and the Tribunal directed the approval of price lists after providing the appellants with the option to choose between the two assessment methods. Additionally, the Tribunal overturned the penalty imposed on the appellants, finding no justification for it in the circumstances of the case.

In conclusion, the Tribunal upheld the appellants' right to choose the assessment method that best suits their interests, emphasizing that they cannot be forced to avail the benefit of Notification 245/83 for all medicines falling under the Price Control Order. The judgment highlights the importance of providing appellants with the discretion to select the most favorable assessment approach and sets aside the lower authority's decision while directing the approval of price lists with the appellants' choice in mind.