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Cadila Healthcare Ltd V/S Commissioner of Central Excise


Company & Directors' Information:- CADILA HEALTHCARE LIMITED [Active] CIN = L24230GJ1995PLC025878

    Appeal No. E/999/2006 [Arising out of Order-in-Appeal No. GOA/CEX/SNS/27/2006 dated 31st January 2006 passed by the Commissioner of Central Excise and Customs (Appeals), Goa]

    Decided On, 06 February 2017

    At, Customs Excise Service Tax Appellate Tribunal West Zonal Bench At Mumbai

    By, THE HONORABLE JUSTICE: RAMESH NAIR
    By, MEMBER AND THE HONORABLE JUSTICE: C.J. MATHEW
    By, MEMBER

    For Petitioner: Rajesh Ostwal, Advocate And For Respondents: V.K. Shastri, Asstt. Commissioner (AR)



Judgment Text


1. M/s. Cadila Healthcare Ltd. challenges order-in-appeal No. GOA/CEX/SNS/27/2006 dated 31st January 2006 of Commissioner of Central Excise & Customs (Appeals), Goa on a dispute pertaining to quantity discount/quantity bonus scheme devised for their dealers on clearances of Dulcolax Tabs, Proluton Depot 250 mg and Proluton Depot 500 mg. These clearances were effected on payment of duty on price at which these were sold from the depot. The goods were manufactured in July 2003 and September 2003 for sale in August 2003 and October 2003. The original authority issued notice dated 27th February 2004 proposing to recover ` 1,92,538/- as the differential duty arising from the allegation that the discount/bonus scheme was not operational in July and September 2003. The demand confirmed thereafter was upheld by the first appellate authority.

2. It is the contention of appellant that section 4(1) (a) of Central Excise Act, 1944, as amended by Finance Act, 2003, requires duty to be assessed on transaction value and that the goods were subject to sale at maximum retail price printed on the packaging. According to them, resort to Central Excise Valuation (Determination of Price of Excisable Goods) Rules, 2000 and, in particular, to rule 7 therein is contrary to law. They contend that the lower authorities had, erroneously, relied upon value of clearances of July 2003 and September 2003 instead of actual sale values of August 2003 and October 2003.

3. We have heard Learned Counsel for appellant and Learned Authorized Representative. The contents of impugned order were reiterated by the latter. The decision of the Tribunal in Biochem Pharmaceutical Industries v. Commissioner of Central Excise, Mumbai-III [2016 (337) ELT 276 (Tri-Mumbai)] was cited on behalf of the appellant. We notice that it has held therein that

"6. We find that this fact is not under dispute that the goods were first cleared from the factory not for sale but as a stock transfer to their depot and from depot the actual sale has taken place. The correct sale value and discount if any, can only be determined and reflected in the sale bill and same is irrelevant in case of clearance from factory to depot as said transaction is not the sale transaction therefore even if all the judgments relied upon by the Revenue are applied, it will support the appellant's case for the reason that they have declared their quantity discount before the sale of the goods from the place of removal i.e. Depot and discount was shown in the sale invoice. In recent judgment of Purolator India Ltd. v. Commissioner of Central Excise, Delhi-III, we find that as per the definition of transaction value under the amended Section 4 the transaction value means the price actually paid or payable for the goods, when sold, and includes in addition to the amount charged as price, any amount that the buyer is liable to pay to, or on behalf of, the assessee, by reason of, or in connection with the sale, whether payable at the time of the sale or at any other time, including, but not limited to any amount charged for, or to make provision for, advertising or publicity, marketing and selling organization expenses, stor

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age, outward handling, servicing, warranty, commission or any other matter, but does not include the amount of duty of excise, sales tax and other taxes, if any, actually paid or actually payable on such goods." 4. Accordingly, we find that the demand of differential duty is without merit. The impugned order is set aside and appeal allowed.
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