1998 (10) TMI 113 - AT - Central Excise

Summary

Issues: Valuation of printed polyethylene multilayer film for excise duty assessment.

Issue 1: Valuation of printed polyethylene multilayer film
The appeal involved a dispute regarding the valuation of printed polyethylene multilayer film for excise duty assessment. The Collector of Central Excise, Meerut had modified the price list filed by the respondent by adding the cost of art work and cylinder making charges, which was challenged in the Order-in-Appeal. The Collector (Appeals) set aside the modification, citing a Tribunal decision and exempting the film from excise duty. The department contended that all elements enriching the marketability of the product should be included in its assessable value. The respondent argued that the film remained duty paid plastic even after printing and referred to relevant legal precedents supporting their stance.

Issue 2: Inclusion of art work and cylinder making charges
The department argued that the cost of art work and cylinder making charges should be included in the assessable value of the printed film as they were necessary for its manufacture. They relied on legal decisions supporting the assessment based on the value in which the goods are cleared from the factory. The respondent opposed this, stating that the art work related to an exempted product and should not affect the duty assessment. The Tribunal analyzed the case, considering the nature of the printed films, their usage for packaging, and the significance of printing in determining the assessable value.

Issue 3: Application of legal precedents
The Tribunal examined various legal precedents cited by both parties, including decisions related to the inclusion of costs in the assessable value and the classification of printed products under specific tariff headings. The Tribunal differentiated cases involving different types of printed products, such as labels and cartons, to determine the impact of printing on the final product's classification and assessable value. The judgment emphasized the need to assess the duty based on the value applicable to the form in which the goods are cleared from the factory.

Conclusion
After thorough analysis, the Tribunal concluded that the proportionate cost of art work and cylinder making charges should be included in determining the assessable value of the printed polyethylene multilayer film. The decision was based on the nature of the goods, their usage for packaging, and the significance of printing in the final product. The Tribunal set aside the Order-in-Appeal and allowed the appeal, highlighting the correct assessment methodology based on the value in which the goods are cleared from the factory.