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TMI Blog1990 (10) TMI 193X X X X Extracts X X X X X X X X Extracts X X X X ..... sportation only. The Department s case is that without the packing the engines cannot be transported or sold and that, therefore, the value should be included. 2. Shri Lakshmikumaran, the learned Advocate submitted that as made clear in the judgment of the Supreme Court in Bombay Tyre International [1983 (14) E.L.T. 1896 S.C. - paragraph 51] the question of inclusion of value of packing should be based on strict interpretation. The learned Advocate referred to the judgment of the Supreme Court in Union of India v. Godfrey Philips India Ltd. [1985 (22) E.L.T. 306. S.C.] and submitted that 100% of the cigarettes was sold in CFC, the value was held to be not includible. Referring to the judgment of the Supreme Court in Jeep Industries (Civil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is only the later type of packing that should be included in the value. 3. Shri L.P. Asthana, the Jt. CDR opposing the arguments submitted that there is no distinction between shipping and non-shipping containers or transport or non-transport containers for purposes of Section 4. He submitted that packing cannot be considered in isolation, but should be considered with reference to the nature of the product. He argued that the two types of containers referred to by the learned Advocate were interchangeable. He emphasised that wooden crates involves here are primary packing and not secondary packing. Referring to the Supreme Court s decision cited by Shri Lakshmikumaran, Shri Asthana argued that there is no conflict between these judgment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... submissions made by both sides it is quite clear that (i) the engines sold by the appellants are always packed in the wooden crates and (ii) the wooden crates protect the goods and facilitate transportation. 8. There being no dispute about the factual position, a decision in this matter will have necessarily to be based on the legal meaning and interpretation of Section 4. In paragraph 51 of the judgment in Bombay Tyre International (supra) the Supreme Court extensively considered the scope of packing for the purpose of valuation. They held that it is the packing in which it is ordinarily sold in the course of wholesale trade to the wholesale buyer is the packing, the cost of which should be included in the value. They also noted that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch they are generally sold that is relevant. We are aware of the extensive arguments of both sides about the ratio of this judgment (Ponds), the learned Advocate insisting that it should be ignored and the learned DR insisting to the contrary. After carefully perusing this judgment we note that the Supreme Court having interpreted the earlier judgments which were taken note of in this judgments, it would not be correct for us to say that the Supreme Court s judgment is wrong. Therefore, we have to go by the ratio of this judgment. 10. However, there is one important difference which would cause some difficulty in applying the ratio of the judgments in Ponds, and in other matters to the facts of the present case. In Godfrey Philips small p ..... X X X X Extracts X X X X X X X X Extracts X X X X
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