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TMI Blog2007 (11) TMI 154X X X X Extracts X X X X X X X X Extracts X X X X ..... [Order per: P.G. Chacko, Member (J)]. -1. This is an appeal filed by the Revenue. The respondents are manufacturers of "Nylon Filament Yarn" meant for use in the manufacture of "Tyre cord Fabrics". They use durable packing materials like paper cartons and paper tubes for packing their product before its clearance from the factory. During the period of dispute [1994-95 to July '96], they had cleared their products in this manner to different buyers, on payment of duty on the goods on an assessable value not including the cost of the packing material. In other words, they claimed abatement of the cost of packing material in terms of Section 4(4)(d)(i) of the Central Excise Act, from the invoiced price of the goods, while paying duty t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1987 (27) E.L.T. 598 (S.C.) and Mahalakshmi Glass Works (P) Ltd. v Collector , 1988 (36). E.L.T. 727 (S.C.), the Hon'blè Supreme Court laid down the law on the point. It is submitted that actual return of the packing material is not relevant in so far as Section 4(4)(d)(i) is concerned. What is required is whether the packing material is durable and also returnable by the buyer. Where it is shown that there was an arrangement between the seller and the buyer that the packing material would be returned by the latter, the material would be considered to be durable and returnable for purposes of above provision and, in that factual situation, the cost of the material would be liable to be deducted from the invoiced. It is submitted by l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le by them. The appellants' declaration in the invoices did reflect the arrangement between the seller and the buyer that the paper tubes were returnable by the latter. Arguments to the contra cannot be accepted. The ruling of the Apex Court, rendered in the cases of K. Radha Krishaiah (supra) and Mahalakshmi Glass Works (supra) was to the effect that where the packing material was durable and the arrangement between the seller and the buyer was for return of the material by the buyer, the cost of the material would be excluded from the assessable value of the excisable goods under Section 4(4)(d)(i), whether or not there was actual return of the packing material. This position was reaffirmed by the Apex Court in the case of Trive ..... X X X X Extracts X X X X X X X X Extracts X X X X
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