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TMI Blog2023 (3) TMI 534X X X X Extracts X X X X X X X X Extracts X X X X ..... nal scheme. The appellant is also clearing the said goods in bulk form in a carton. Therefore, as per standards of weights and measure Rules, the appellant are not under legal obligation to affix the retail sale price on this supplies. Therefore, the valuation of tooth brush when supplied in bulk quantity in carton was rightly valued under Section 4 of the Central Excise Act, 1944. This very issue has been considered by this Tribunal in the case of M/S CONTEMPORARY TARGETT PVT LTD VERSUS C.C.E. S.T. -VADODARA-I [ 2019 (5) TMI 871 - CESTAT AHMEDABAD ] where it was held that the tooth brushes supplied by the appellant which is not for retail sale but for free supply by the tooth paste manufacturer will not be valued under Section 4A in the hands of the appellant - the value adopted by the appellant under Section 4 is correct and legal which does not need any interference. The impugned order is not sustainable. Accordingly, the same is set aside - Appeal allowed. - Excise Appeal No. 11559 of 2013-DB - Final Order No. A/10219/2023 - Dated:- 7-2-2023 - Hon'ble Member (Judicial), Mr. Ramesh Nair And Hon'ble Member (Technical), Mr. Raju For the Appellant : ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llant are not under legal obligation to affix the retail sale price on this supplies. Therefore, the valuation of tooth brush when supplied in bulk quantity in carton was rightly valued under Section 4 of the Central Excise Act, 1944. This very issue has been considered by this Tribunal in the case of . Contemporary Targett Pvt Ltd vide Final Order No. A/10837/2019 dated 13.05.2019, wherein the following order was passed: 4.We have considered the submission made by both the sides and perused the records. We find that the facts is not under dispute that the tooth brushes manufactured and supplied by the appellant were cleared either in bulk form or combo pack or in naked condition that means without any retail packing. Goods were supplied to tooth paste manufacturer who in turn used these tooth brushes for making a combo pack with tooth paste for free supply, therefore, the tooth brushes cleared by the appellant was neither sold as such in retail either by the appellant or the buyers i.e. M/s Colgate Palmolive (India) Limited, Oral care etc. In this identical fact the issue was considered by the Hon ble Supreme Court in the case of Jayanti food processing (P) Ltd. Vs Commissione ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n each chocolate as the SWM (PC) Rules and more particular Rule 6(1)(f) would be applicable to them. Learned Counsel, however, says that his contention is restricted only to the supply made by the assessee to Pepsico. He points out that the said chocolates were not being sold by the manufacturer in retail but were supplied to another company under a contract and the purchaser company was not to sell the said chocolates as the chocolates but to offer as a free gift along with its product, namely, a 1.5 litres bottle of Pepsi. Learned Counsel also criticized the order of the Tribunal. Learned Counsel also relied on the aforementioned Board Circular dated 28- 2-2002. 23. The Tribunal formulated a question as to whether the package of KITKAT sold by the appellant to M/s. Pepsico India Holdings Ltd., under a contract of Rs. 4.80 per KITKAT are required to be assessed at that price in terms of Section 4 of the Act or the assessable value of the same is required to be arrived at in terms of Section 4A of the Act. The Tribunal while accepting the case of the Revenue simply went on to hold that once the goods are specified items under Section 4A(1) of the Act and are excisable goods, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Para 6 of the notification is as under : It is, therefore, clarified that, in respect of all goods (whether notified u/s. 4A or not) which are not statutorily required to print/declare the retail sale pric on the packages under the provisions of the Standards of Weight Measures Act, 1976, or the Rules made thereunder or any other law for the time being in force, valuation will be done u/s. 4 of the C.E. Act, 1944 (or under Section 3(2) of the Central Excise Act, 1944, if tariff values have been fixed for the commodity). Thus, there could be instances where the same notified commodity would be partly assessed on the basis of MRP u/s. 4A and partly on the basis of normal price (prior to 1-7-2000) or transaction value (from 1- 7- 2000), u/s. 4 of the C.E. Act, 1944. Learned Counsel very heavily relied on the last sentence of Para 6 of the notification and pointed out that the KITKAT chocolate though a notified commodity, need not, in all cases be assessed under Section 4A. According to the learned Counsel stated that this had a direct reference to Entry 4 in Para 1 of the Circular which we have extracted above. Our attention was also invited to a ruling of the Tribunal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eemed to be the retail sale price declared on such goods, less amounts of abatements etc. As we have already observed that Weights Measures Act requires chocolate manufactured by the appellant to be printed with MRP on the same, we are of the view that the duty of excise on such goods is required to be assessed in terms of the MRP. The only exception where a manufacturer can deviate from the general rule of printing of MRP on the package is Rule 34 of Standards of Weights Measures (Packaged Commodities) Rules, 1977. We are afraid the law is too broadly stated here. It may be that chocolates manufactured by the appellant are required to bear the declaration of MRP but that cannot be true of all the chocolates. In this the Tribunal has ignored Para 6 of the aforementioned circular dated 28- 2-2002 wherein it is specifically provided that there would be instances where the same notified commodity would be partly assessed on the basis of MRP under Section 4A and partly on the basis of normal price prior to 1-7-2000 or transaction value from 1-7-2000. Again merely because the goods are specified items under Section 4A(1), that by itself will not be a be all and end all of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... even if the appellant itself intended to give the bar of KITKAT as a free gift to its customers along with other item, the appellant would not be in a position to claim that there is no assessable value of the goods and as such no duty of excise shall be charged on the same. The logic is clearly faulty. In the given circumstances, the appellant would undoubtedly be assessable to duty under Section 4 of the Act. It is not as if the appellant would be totally exempt from paying any duty on such goods. It was rightly contended before the Tribunal that the thrust of Section 4A is on the packages and not on the commodity and it is only where the goods are sold in the packages that the section would be attracted. The submission was undoubtedly right. The Tribunal, while rejecting this submission, has clearly ignored the language of Section 4A(1) of the Act. 28. 29. It was then suggested that the free gift by Pepsi to its customers would amount to distribution and would, therefore, be amounting to retail sale and the package of KITKAT would be retail package . However, what is material is the definition of retail sale price . The requirement of Rule 6(1)(f) is specific. It req ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Revenue Department are against the Electrolux Kelvinator Ltd., and Electrolux India Ltd. These cases pertain to the valuation of the Refrigerators manufactured by the assessees. It is a common plea that after the manufacture of these Refrigerators, they are sold to the Bottling Companies like Pepsi, Coca Cola and other soft drink manufacturers under the contract. It is further admitted position that all the Refrigerators which are sold are packed in a package declaring the MRP on them. The MRP and the contract price are different. It was the claim of the assessees that they have paid the duty under Section 4A(1) of the Act on the MRP. The goods are specified goods under Section 4A(1) of the Act. However, because of the abatements they have to bear lesser duty which abatements are not available to the contract price. Therefore, if the duty is assessed on the basis of the contract price under Section 4 of the Act, the duty would be more than the duty paid under Section 4A(1) of the Act. The Tribunal, in all the three cases, has held in favour of the assessees holding that these cases would be governed by the decision of the Tribunal in 35. ITEL Industries Pvt. Ltd. v. CCE reported in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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