9911796707
TMI Blog1984 (11) TMI 335X X X X Extracts X X X X X X X X Extracts X X X X ..... 3-2-1977, the learned Collector held that the assessable value for the refrigerant gases, manufactured by M/s. Navin Fluorine Industries (hereinafter referred to as NFI) to M/s. Hoechest Dyes Chemicals Ltd. (hereinafter referred to as Hoechest) were to be treated as sales to a related person within the meaning of clause (c) of sub-section (4) of Section 4 of the Central Excises and Salt Act, 1944 (hereinafter referred to as Act) and accordingly, the assessable value should be determined with reference to the prices charged by Hoechest to its wholesale buyers and not at the prices at which NFI sold the said goods to Hoechest. 3. The case against the appellants as discussed in the Collector s order and supported by Shri Jain, the learne ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ine), M/s. Hoechest and M/s. Polyolefins Industries Ltd. (hereinafter referred to as PIL). He submitted that the appellants sales to Hoechest could not be considered as sales to a related person as contended by the lower authorities. These sales were genuine transactions, acceptable under provisions of Section 4 of the Act and could be corroborated by their invoices to other buyers. The learned Collector had, by referring to the equity composition of various companies, tried to establish remote connection between the appellants and Hoechest and thereby held that Hoechest were a related person vis-a-vis the appellants. Even in their reply dated 22-3-1976 to the show cause notice, which was sent long before the pronouncement of the Supreme C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eer thereafter referred to the Supreme Court judgment (supra) and submitted that it had been held by the Supreme Court that to qualify for being related persons both parties must have interest in each others business (emphasis supplies). He stated that for the sake of argument one could state that by virtue of M/s. Mafatlal Industries Ltd. s equity holding in the appellant company as well as Hoechest, it had some interest in the business of these two corporate bodies. However, since neither the appellant Company nor Hoechest had any equity participation in Mafatlal Industries nor between themselves, it could not be argued that these two corporate bodies had any interest in the business of M/s. Mafatlal Industries Ltd. In short, applying t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the Supreme Court had squarely dealt with the issue in the present appeal and the benefit of the ratio of the judgment was available to the appellants as well. 4. The second ground adopted by the learned Collector was that during 1975, the appellants sold more than 97% of their product to Hoechest. Shri Engineer submitted that ab initio this position taken by the learned Collector was erroneous in law. Reference to 97% of the product was to the goods manufactured by NFI and NFI were only a Division of the appellant Company and had no legal status of its own. The mere fact that they had been issued a separate licence for central excise purposes did not confer on NFI the status of a separate legal corporate body. The sale of refrigerant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the refrigerant gases were the same to whomsoever they were sold. Shri Engineer referred to clauses 4, 5, 8, 9, 14 etc. of the agreement and with regard to each he explained that none of these amounted to detract from the principal to principal character of sales between the appellants and Hoechest and, for that matter, the other two parties with whom identical agreements had been entered into. Summing up the appellants case, Shri Engineer submitted that applying the ratio of the Supreme Court judgment, the orders passed by the learned Collector of Central Excise, Baroda could not be sustained and should be struck down. Further, the appellants had also put forth all the evidence available to show that the prices charged by the appellan ..... X X X X Extracts X X X X X X X X Extracts X X X X
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