Teekay Menthon Pvt. Ltd. Vs. Cce - Court Judgment

Excerpt:
1. the duty demand in the present case has arisen on account of denial of assessment in terms of notification no. 245/83 to the appellant. the appellants are manufacturers of p&p medicines and sought assessment of their goods under notification no. 245/83. that notification had permitted assessment of the goods at the marked price minus 15%.however, the exemption was subject to the condition that the appellant availed himself of that notification in respect of all medicines manufactured by him. the appellant in the present case sought assessment of certain other medicines on the basis of wholesale price also. the assistant collector, thereupon, held that the appellants could not avail themselves of notification no. 245/83 in respect of one set of medicine and assessment under section 4 of the central excise act in respect of other medicines. therefore, he denied the benefit of deduction of 15% and demanded duty accordingly. the learned counsel representing the appellants today submitted that the assessment of the goods after denial of 15% deduction amounts to assessing goods at retail price which is not permissible at all. he submits that the assistant collector should have fixed the assessable value under section 4(1)(a) at the normal whole-sale price rather than demanding duty at the retail price. we have heard the learned dr also.2. once the medicines were denied the benefit of notification no.245/83, they were required to be assessed in terms of section 4 of the central excise act. at the relevant time, assessable value under section 4 was the whole-sale price. the present order of the assistant collector has approved retail price of the medicines as the assessable value. this is clearly contrary to the relevant legal provisions. the demand also is excessive on account of that. it is, therefore, necessary that the cases be reconsidered by the assistant collector, the assessable value fixed in terms of section 4(1) and demand, if any, arising on such re-computation of assessable value made. the appeals are, accordingly, disposed of by way of remand. the assistant commissioner shall re-fix the assessable value of the medicines in terms of section 4 and pass a fresh order demanding differential duty, if any, on the basis of the assessable value fixed under section 4.needless to say, the same shall be done after giving the appellants an opportunity to present third case. since this dispute is of 1992, we direct that the matter be taken up forthwith so as to finalise the remand proceedings within 3 months from the receipt of a copy of this order.

Judgment:
1. The duty demand in the present case has arisen on account of denial of assessment in terms of Notification No. 245/83 to the appellant. The appellants are manufacturers of P&P medicines and sought assessment of their goods under Notification No. 245/83. That notification had permitted assessment of the goods at the marked price minus 15%.

However, the exemption was subject to the condition that the appellant availed himself of that notification in respect of all medicines manufactured by him. The appellant in the present case sought assessment of certain other medicines on the basis of wholesale price also. The Assistant Collector, thereupon, held that the appellants could not avail themselves of Notification No. 245/83 in respect of one set of medicine and assessment under Section 4 of the Central Excise Act in respect of other medicines. Therefore, he denied the benefit of deduction of 15% and demanded duty accordingly. The learned counsel representing the appellants today submitted that the assessment of the goods after denial of 15% deduction amounts to assessing goods at retail price which is not permissible at all. He submits that the Assistant Collector should have fixed the assessable value under Section 4(1)(a) at the normal whole-sale price rather than demanding duty at the retail price. We have heard the learned DR also.

2. Once the medicines were denied the benefit of Notification No.245/83, they were required to be assessed in terms of Section 4 of the Central Excise Act. At the relevant time, assessable value under Section 4 was the whole-sale price. The present order of the Assistant Collector has approved retail price of the medicines as the assessable value. This is clearly contrary to the relevant legal provisions. The demand also is excessive on account of that. It is, therefore, necessary that the cases be reconsidered by the Assistant Collector, the assessable value fixed in terms of Section 4(1) and demand, if any, arising on such re-computation of assessable value made. The appeals are, accordingly, disposed of by way of remand. The Assistant Commissioner shall re-fix the assessable value of the medicines in terms of Section 4 and pass a fresh order demanding differential duty, if any, on the basis of the assessable value fixed under Section 4.

Needless to say, the same shall be done after giving the appellants an opportunity to present third case. Since this dispute is of 1992, we direct that the matter be taken up forthwith so as to finalise the remand proceedings within 3 months from the receipt of a copy of this order.