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TMI Blog1983 (8) TMI 255X X X X Extracts X X X X X X X X Extracts X X X X ..... for the appellants has submitted that the appellants are manufacturers of woollen felts falling under Tariff Item 68 of C.E.T. During the year 1977-78, the appellants produced goods of `gross sale price amounting to ₹ 34,42,961.17. They claimed the benefit of exemption Notification No. 176/77, dated 18-6-1977 as amended by Notification No. 246/77, dated 15-7-1977. 3. On scrutiny of the records, the central excise authorities issued a show cause notice to the appellants asking them as to why central excise duty should not be charged on the woollen felts cleared from their factory in the year 1978-79 in excess of the exemption limit of ₹ 30 lakhs and also on the goods cleared during the year 1979-80. After receipt of the appe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the lower authorities in not allowing the deduction of ₹ 2,39,866.59, being the value of goods which were not taken by the buyers, Shri Garg maintained that their value could not be taken into account for determining the assessable value. According to Shri Garg, since these goods were not taken delivery of by the buyers, the sale in respect thereof was not complete. Old Section 4 (prior to 1-10-1975) referred to `wholesale cash price and new Section 4 refers to `a price at which such goods are ordinarily sold........in the course of wholesale trade . Whether viewed in the context of old Section 4 or the new Section 4, the material fact remains that goods were not taken delivery of by the customers and the same had to be brought back ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) in the appellants giving 5% discount to M/s. Rajasthan Enterprises. 8. Shri Garg found fault with the finding of Assistant Collector that appellants had charged the full value of the goods including the commission to be paid to M/s. A.K. Shah and had paid sales tax as per the invoice value. According to Shri Garg payment of sales tax had nothing to do with the assessable value of the goods for excise purposes in the facts of the present case. He also contended that the lower authorities had incorrectly inferred from evidence placed before them that the appellants had a special relationship with M/s. A.K. Shah. He contended that Delhi High Court had held that mutuality of interest in the business of each other had to be established befo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he levy of central excise duty till the stage of clearance from the factory gate. Once the goods were cleared from the factory, the Department had nothing to do with such goods, or how they were utilised by the parties to whom these were sold or supplied. In this connection, he described the scheme of the Act and the Rules governing the levy and collection of central excise duty vide Section 3 of the Act read with Rules 9A and 49 of the Central Excise Rules. 10. Regarding the discount allowed to M/s. Shah, Shri Mahesh Kumar contended that the term normal price has reference to the buyers of the goods and not to `distributors or underwriters appointed for sale of excisable goods. Likewise, any discount where admissible vide Section 4(4)( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent of excise duty which are not accepted by the buyers can be brought back and their value can be deducted from the assessable value of the goods to be cleared subsequently. Further, wherever excisable goods are brought back to the factory for repair, re-conditioning etc. and subsequently cleared, all these operations are governed by clearly laid down procedures. This is necessary to ensure that there is proper accounting of such goods by way of documentation, physical control and other checks. Thus we are in full agreement with the reasoning of Shri Mahesh Kumar and see no substance in the submissions put forth by Shri Garg in this behalf. 12. Further, we are also unable to accept the contention of Shri Garg that commission paid to fin ..... X X X X Extracts X X X X X X X X Extracts X X X X
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