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TMI Blog2005 (9) TMI 522X X X X Extracts X X X X X X X X Extracts X X X X ..... of profit has been added to the cost of the product etc. But later the Department questioned the applicability s of Rule 6b(ii) itself in a situation where the value of comparable goods to physician samples is available. The Department s contention is that where the value of comparable goods is available it should be adopted for the purpose of arriving at the value of physicians samples after allowing proper adjustments. The department has also been of the view and correctly so, that Rule 6b(ii) comes into picture only when value cannot be determined under Rule 6b(i) of Customs Valuation Rules, 1975. After the introduction of new Central Excise Valuation Rules, 2000 the position underwent a change. The CBEC in its Circular No. 643/34/2002-CX dt. 1-7-2002 clarified that the value of physicians samples be determined under Rule 11 read with Rule 8 whereby the value of physicians samples would be 115% of the cost of production of such samples. 2. All the appeals pertained to valuation of Physician Samples. The periods involved are different though. With this preface we proceed to deal with the appeals. We have heard both sides and considered the various submissions made. Appeal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ule 11 will have to be adopted along with the spirit of Rule 8 to arrive at the value of physician samples. In other words the assessable value has to be arrived at 115% of the cost of production of the samples. This is what exactly the appellants were doing, while arriving at the value of physician samples. The Commissioner s order that the value should be arrived at on a basis other than the one contained in the CBEC Circular (Supra) is totally unacceptable. Any demand worked out on the basis different from the one contained in Board s clarification in this regard does not have force of law. 9. The appeal is allowed. The order of the Commissioner is set aside. E/587/2000 10. This one arises out of the order of Commissioner (Appeals) who while dealing with the Department s appeal against the order of lower authorities allowed the Department s appeal. The Department s contention before him was that the value of physician samples should be arrived at under Rule 6b(i) of Central Excise Rules, 1975 and not under Rule 6b(ii) (Cost Construction Method) as was ordered by the Assistant Commissioner. The Commissioner agreed with the Revenue s view citing two decisions of the Tribunal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the Assistant Commissioner had done was to follow the direction of a higher appellate authority. The Department having failed to appeal against the remand order of the Commissioner cannot achieve the same result in an indirect way. The Commissioner was entertaining an appeal against his own order in this case. It is not permissible. The impugned order needs to be set aside on this ground without going into the merits of the case. We accordingly set aside the order of the Commissioner on this limited ground. E/718/02 13. This appeal is against the order of Commissioner (Appeals) who dismissed the appeal before him on the ground that it is time-barred. The order-in-original was received by the appellant on 27-6-2001. Appeal against this should have been filed within 60 days of receipt of the order by 25-8-2001. The appellant however filed the appeal before the Commissioner on 21-9-2001 i.e. after a further delay of 27 days. The lower appellate authority considered the pleadings of the appellants putforth before him and refused to condone the delay. He accordingly dismissed the appeal as time-barred. 14. The appellants contended that the Commissioner has discussed the merits o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ose mentioned in the First Schedule. They are not exempt from payment of duty under any notification. They are therefore leviable to duty at the rate specified. The appellants call their goods as physician samples. Under Drug Price (Control) Order the samples are forbidden from being sold. There is no dispute that the samples in question are distributed free to medical practitioners who experiment them on patients who happen to visit them or prescribe them if they are impressed with the literature accompanying the free samples. The issue pertains to valuation of these physician samples. 19. This Tribunal in the case of the appellants Cross Land Research Laboratory [2002 (150) E.L.T. 212] dealt with issue of valuation of physician samples in the remand proceeding when a contention was raised, before the Hon ble Supreme Court by the said appellants in their Civil appeals that the Cost of Physician Samples manufactured and cleared already forms a part of the sale price of the Commercial Packs of the medicines. In support of this contention the appellants in that case filed a certificate of their Chartered Accountant who certified that the cost of physician samples was in built into ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and on physician samples is sustainable and accordingly uphold the same. Penalty imposed for contravention of the Rules by removal of goods without payment of duty thereon is also sustainable and is upheld . 21. The Tribunal rejected the contention of the appellant that the value should be arrived on the basis of cost of production and upheld the Department s contention that as prices for the big packs for the same products for sale at the factory gate are available the price of physician samples are to be worked out on pro rata basis for the samples as per Section 4(1)(b) of the Central Excise Act, read with Rules 7 and 6(b) of Central Excise Valuation Rules, 1975. The reasoning given and the conclusion arrived at in that case have to be followed as the appellants in the present case have not come out with any decision upsetting the decision in Cross Land Laboratories case cited supra. 22. The appellants contention that it results in double taxation if comparative price envisaged in Rule 6(b)(i) is followed cannot be considered by us so long as the duty is levied and collected in accordance with law. It would perhaps be in the legislative competence of the legislature to cons ..... 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