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TMI Blog2010 (12) TMI 266X X X X Extracts X X X X X X X X Extracts X X X X ..... t. 2. The dispute in the matter is whether the electric fans supplied by the appellants to the various department of the Government during the period from March 2002 to October 2003 at the rate agreed upon between the appellants and DGS&D to be assessed under Section 4 or 4A of the said Act. The authorities below have held that the assessment had to be under Section 4 and not under Section 4A as was claimed by the appellants. 3. The facts that the appellants are manufacturers of electric fans and had agreed for supply of such fans to different departments of the Government during the period from March 2002 to October 2003 at the rate agreed upon with the DGS&D are not in dispute. Accordingly various fans under 66 invoices issued during the period from March to May 2003 and under 21 invoices during the period from June 2003 to October 2003 were supplied to the government departments. The entire dispute resolves round the question as to whether such supply can be considered as a retail sale or wholesale sale which is commonly known as bulk sale. 4. The learned advocate for the appellants placing reliance in the decisions in the matter of Jayanti Food Processing (P) Ltd. vs. CCE, R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d were not actually sold at the price shown on the packages is immaterial as in cases where there is obligation for manufacturer to print a MRP on the packages with only exception as specified under Rule 34 of the said Rules and in the facts and circumstances of the case, the same was not attracted. He further submitted that this position has also been accepted by the department in another case of the appellants themselves and that is apparent from the order of the Deputy Commissioner, Noida passed on 28th February 2005 in relation to the period from 1st September 2001 to 31st December 2003. 5. On the other hand the DR submitted that the supply of goods was not on retail basis but on wholesale basis in as much as that the supply was for a fixed period and at the rate agreed upon under the contract with DGS&D. Such a supply according to the DR cannot be construed as retail sale but has to be considered as bulk sale. Placing reliance in the decision in the matter of CCE, Chennai II vs. Australian Foods Ltd. reported in 2009 (242) E.L.T. 504 (Mad.) and CCE, Raipur vs. Aero Agro Chemical Inds. Pvt. Ltd. reported in 2007 (217) E.L.T. 396 (Tri. Del.) submitted that the decision of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntitled to have a reduction of abetment as declared by the Central Government by the notification in the official gazette. 7. The Apex Court further specifically enumerated the five factors which are required for applicability of Section 4A as under :- (i) The goods should be excisable goods (ii) They should be such as are sold in the package ; (iii) There should be requirement in the SWM Act or the Rules made thereunder or any other law to declare the price of such goods relating to their retail price on the package ; (iv) The Central Government must have specified such goods by notification in the Official Gazette ; and (v) The valuation of such goods would be as per the declared retail sale price on the packages less the amount of abatement. 8. Plain reading of the above reading of the Apex Court in Jayanti Food Processing (P) Ltd. would disclose that in order to take resort to Section 4A for the purpose of valuation of the goods and assessment of duty all the five factors narrated therein must be present. One of those five factors is that there should be requirement in the SWM Act or the Rules made thereunder or any other law to declare the price of such goods relating t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tioned package is intended for sale, distribution or delivery to an intermediary and is not intended for sale direct to a single consumer ; or (ii) a commodity sold to an intermediary in bulk to enable such intermediary to sell, distribute or delivery such commodity to the consumer in smaller quantity ; or (iii) packages containing ten or more than ten retail packages provided that the retail packages are labelled as required under the rules. 11. In view of various arguments sought to be advanced it would be worthwhile also to take note of Rule 34. The same reads as under :- Rule 34. Exemption in respect of certain packages. Nothing contained in these rules shall apply to any package containing a commodity if, - (a) the marketing on the package unambiguously indicates that it has been specially packed for the exclusive use of any industry as a raw material or for the purpose of servicing any industry, mine or quarry : Provided that this exemption shall not be available in respect of (i) any yarn which is sold in hanks to handloom weavers ; (ii) any component, part or material used in any workshop, service station or any other place where servicing or repairing of any bicycl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it refers to wholesale supply. But before arriving at any finding about the wholesale supply or bulk supply in a case where a dispute is raised that the nature of supply does not disclose to be the bulk supply, but it is a retail supply, it is always necessary for the Adjudicating Authority to analyse the materials placed on record in that regard by both the parties and to arrive at a appropriate finding as to whether the nature of supply discloses to be of wholesale nature or retail one. Neither the perusal of the order passed by the Adjudicating Authority nor by the lower Appellate Authority discloses any discussion on this aspect nor any specific finding, and that too when records clearly disclose the dispute having been raised by the appellants that it was not a bulk supply but a retail supply. It was sought to be contended on behalf of the department that since the supply was made for a number of months it is to be construed as a bulk supply, however, we are not being pointed out any provision of law in that regard which give rise to such presumption nor any specific finding in that regard by either of the lower authorities. Since the entire dispute resolves round this basic ..... X X X X Extracts X X X X X X X X Extracts X X X X
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