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TMI Blog1991 (6) TMI 143X X X X Extracts X X X X X X X X Extracts X X X X ..... naspati. At the time of selling their Vanaspati, the appellants in their invoices separately indicated the price of the Metal tin containers . An express condition is also incorporated in the invoices that the Metal tin containers are returnable and durable and that on return of the Metal tin container , the appellants would return to the buyer amounts collected on account of metal tin. Prior to May 1980, they have included the value of metal tins/containers in the assessable value of Vanaspati. However, after the judgment of the Supreme Court in Bombay Tyre International [1983 (14) E.L.T. 1896 (S.C.)], they have stopped paying excise duty on metal containers. Therefore, a show cause notice was issued on 5-11-1980 proposing to recover d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... elation to any excisable goods, - (i) where the goods are delivered at the time of removal in a packed condition, includes the cost of such packing except the cost of the packing which is of a durable nature and is returnable by the buyer to the assessee." Interpreting the above provision, the Supreme Court in Radhakrishaiya v. Inspector of Central Excise, [1987 (27) E.L.T. 598] held that if the packing is returnable and durable, then its cost is liable to be excluded in computation of the assessable value of the goods for the purpose of excise duty. So far as the question of durability is concerned, there cannot be such controversy about it, but a question has been raised as to what is the meaning and connotation of the word returnab ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... In other words, according to the Supreme Court, there should be an arrangement between the buyer and seller indicating the returnability of the packing. Secondly, actual return or extent of return of the durable and returnable containers is not relevant. If the buyer chooses to return the packing, the seller should be obliged to act and refund the stipulated amount. 8. The Tribunal in C.C.E. v. E.I.D. Parry (India) Ltd. [1989 (40) E.L.T. 139 (Tri.)] laid down the following tests after considering the judgments of the Supreme Court in K. Radhakrishaiya v. Inspector of Central Excise :- It would be worthwhile summarising the norms relevant to returnability of durable containers. We list the norms as under :- (1) Though the word return ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed that this is the pattern of invoice adopted by them in respect of the entire sales. The department has not disputed this fact. The endorsement on the invoice indicates the arrangement between the manufacturer and the buyer and it also indicates that the buyer is under an obligation to return the container and if the buyer returns the container, the manufacturer is under an obligation to return the cost of the container. From the above, it follows that the facts of this case satisfy the test of durability and returnability of the containers under Section 4(4)(d)(i) and the principles laid down by the Hon ble Supreme Court and this Tribunal in the various decisions and orders referred to above. 10. In the light of the above, we allow the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd not of the container cost. Learned advocate, on the other hand, had relied upon para 14 of Parry s case, mentioned supra. He had stated that endorsement by itself makes it very clear that the customers of the appellants could return the containers if they so liked and on return they would reimburse the cost of the container. 10.2. Apart from the aforesaid, I notice that packing cost has been shown separately at the rate of Rs. 13.50 in the invoice, mentioned in the order proposed by my learned sister. The endorsement and the separate packing cost shown in the invoice taken together makes it very clear that the containers were returnable to the appellants in good and sound condition at the customers cost whereupon the cost of the conta ..... X X X X Extracts X X X X X X X X Extracts X X X X
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