2019 (3) TMI 1090 - AT - Central Excise

Method of valuation - section 4 or section 4A of CEA - Watches - Held that - Notification No. 20/1999 CE (NT) dated 28.02.1999 was superseded by Notification No. 09/2000-CE (NT) dated 01.03.2000 and by subsequent supersession of Notifications later, Notification No. 05/2001 dated 01.03.2001 was superseded by Notification No. 13/2002-CE (NT) dated 01.03.2002. In Notification No. 13/2002, Sl. No. 89 refers to watches. These Notifications show that watches were notified goods during the relevant period of dispute - When the goods are notified under Sub-Section (2) of Section 4A of the Central Excise Act, 1944, then, the valuation can only be under Section 4A of the Central Excise Act - The contention of the appellants that the goods do not fall under the category of packaged commodities, etc., cannot be accepted. The said issue was settled by the Hon ble Supreme Court in the case of M/s. Whirlpool of India Ltd. Vs. Union of India 2007 (11) TMI 6 - SUPREME COURT OF INDIA . The Hon ble Supreme Court held that use of the term or otherwise in the definition of commodity in packaged form would suggest that a commodity if packed in any manner in units suitable for sale, whether wholesale or retail, becomes commodity in packed form . Therefore, Section 2(b) of the Standards of Weights and Measures Act, 1976 would apply. Thus, the goods having been notified items, are definitely assessable under Section 4A of the Act - appeals filed by the assessee contending that the goods are to be assessed under Section 4 of the Central Excise Act, 1944, are without merits - appeal dismissed - decided against appellant.

Summary

Issues Involved:
Valuation of excisable goods under Section 4A of the Central Excise Act, 1944.

Analysis:

Issue 1: Valuation under Section 4A vs. Section 4 of the Act
The case involved the assessment of watches under Section 4 of the Central Excise Act, 1944, as requested by the assessee, instead of Section 4A. The Department contended that the watches had been notified under Notification No. 20/99, making them subject to valuation under Section 4A. The appellant argued that the watches did not fall under Section 4A. The Tribunal examined the appellant's letter dated 21.04.1999, where the appellant acknowledged the notification but claimed that their watches did not fit the definition of "commodities in packaged form." However, subsequent notifications superseded the original one, clearly indicating that watches were notified goods. The Tribunal referred to a Supreme Court case, M/s. Whirlpool of India Ltd. Vs. Union of India, which clarified that goods packed in any manner for sale are considered "commodities in packaged form," thus falling under Section 4A. The Tribunal concluded that the watches were assessable under Section 4A, dismissing the appeals challenging the valuation under Section 4.

Issue 2: Maintainability of Appeals
The Commissioner (Appeals) had rejected the initial appeal by the assessee, citing that an appeal against a decision in the form of a letter was not maintainable. The Tribunal, in its previous order, had remanded the matter for fresh consideration after providing a personal hearing to the assessee. The subsequent appeal by the assessee was upheld by the Commissioner (Appeals), leading to the current appeal before the Tribunal. Despite the procedural challenges, the Tribunal addressed the substantive issue of valuation under Section 4A, ultimately dismissing the appeals filed by the assessee.

In conclusion, the Tribunal upheld the valuation of watches under Section 4A of the Central Excise Act, 1944, based on the notifications and legal precedents cited. The dismissal of the appeals highlighted the significance of statutory notifications and the interpretation of relevant legal provisions in determining the appropriate valuation method for excisable goods.