9911796707
TMI Blog1991 (3) TMI 272X X X X Extracts X X X X X X X X Extracts X X X X ..... ne is supplied in cylinders and, in some cases, such cylinders are provided by the customers. The cylinders supplied by the appellants are durable in nature and are returnable by the customers. 2. A dispute has arisen about the expenses incurred by the appellants and described as handling charges . These charges were not included in the assessable value and, in reply to a show cause notice issued by the Assistant Collector, these have been explained by the appellants to be in the nature of post-manufacturing marketing activity and include, inter alia, expenses on account of salary of staff employed for packing and filling operations, expenses for handling and maintenance of cylinders etc. Expenses on maintenance and operation of filling ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4. In the Cross Objection filed by the respondent-Collector, it has been stated that Chlorine cannot be sold unless it is packed in a container which is indispensable for its sale and the contention of the appellants that the packing is a specific service done on the request of the customers is not acceptable. The Collector has also placed reliance on the judgment of the Supreme Court in Bombay Tyres International Limited (1983 (14) E.L.T. 1896) to support the view that packing of Chlorine in cylinders is a primary packing since it cannot be sold without such packing. 5. In their written arguments, the appellants have cited the Supreme Court judgment in the case of M/s. Hindustan Polymers [1989 (43) E.L.T. 165] and the two decisions of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nion of India [1984 (17) E.L.T. 39] as well as that of the Supreme Court in the case of K. Radha Krishaiah v. Inspector of Central Excise, 1987 (27) E.L.T. 598 in both of which there is a reference to an arrangement between the buyer and the assessee under which the packing must be one which is returnable by the buyer to the assessee. The learned SDR contested that the ratio of Radha Krishaiah s judgment did not apply to the present case in the absence of an arrangement between the buyer and the assessee. 8. We have carefully considered the submissions and perused the records of the case including the written submissions of the appellants. We observe that certain aspects of cost of durable and returnable cylinders had come up for consider ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e and maintenance of cylinders; (b) depreciation of value of cylinders and interest paid on the money invested in the cylinders. 10. The elements which should be included in the factory gate price are as under:- (a) expenses on account of salary and staff employed for packing and filling operation of liquid Chlorine; (b) expenses for handling of cylinders within the factory; (c) expenses on maintenance and operation of Filling Plant. 11. It is true that these elements have all been put together under one heading - handling charges , but it is necessary for proper determination of the price to split them up into two parts on the lines indicated above. While arriving at these conclusions, we have kept in view the observations of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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