Gora Mal Hari Ram Ltd. Vs. Collector of Central Excise - Court Judgment

Excerpt:
1. this is an appeal filed by m/s. gora mal hari ram ltd., new delhi, against the order-in-appeal no. 134/ce/appeal/dlh/92, dated 30-4-1992, passed by the collector, central excise (appeals), new delhi.2. the appellants were engaged in the manufacture of detergent cakes and detergent/washing powder. the goods were sold by them through their distributors. they were having distributors for delhi region and distributors for outstation. they filed separate price lists for delhi distributors and for outstation distributors. higher prices were declared for delhi distributors and lower prices were declared for outstation distributors. in both the cases the sales were effected at the factory gate, and in both the cases the price lists were filed in part i of the price list proforma. part i of the price list proforma related to the determination of value for goods sold to unrelated buyers in the course of wholesale trade, under the main definition case, in terms of the provisions of section 4(1 )(a) of the central excises and salt act, 1944 (hereinafter referred to as the 'act').3. it was alleged in the show cause notice that the delhi distributors and the outstation distributors were the same class of buyers, and that the class of buyers did not change merely because they are located in different regions, and that the difference in the prices could not be based upon territorial segregation.4. according to the appellants, different prices were charged by them from their different classes of buyers, on the basis of territorial classification of their delhi distributors and outstation distributors.the reason for charging lower rates from their outstation distributors was to meet the competition at outstation places, and to develop new markets. they submitted that in the outstation markets, they have to compete with other manufacturers of the area who are closer to such markets and who are located in such outstation markets. it was also submitted that the incidence of local taxes and other charges had also been taken into account while fixing their prices for outstation distributors.5. the assistant collector, central excise, division hi, new delhi, relying upon the tribunal's decision in the case of shakti insulated wires pvt. ltd. v. collector of central excise - 1990 (49) e.l.t. 554 (tri.), confirmed the demand.6. while filing the appeal to the collector, central excise (appeals), new delhi, the appellants referred to their price pattern as "providing different discounts for different classes of buyers located in different territories." they further stated that "in the price list the appellant had indicated the respective wholesale prices for the respective territories, instead of distinguishing them by reference to discounts." 7. the collector, central excise (appeals), after examining the provisions of section 4(1)(a) of the act, observed that the prices charged by the appellants from their outstation customers did not satisfy the strict requirement of that section. he further observed that the wholesale dealers by themselves form a class and even though they are located at different places, they can only form one class of buyer. in this connection, he referred to the tribunal's decision in the case of collector, central excise v. orissa cement ltd. - 1984 (17) e.l.t. 161 (tribunal), and the bombay high court's decision in the case of godrej & boyce manufacturing company pvt. ltd. v. union of india, 1984 (18) e.l.t. 172 (bom.).8. the collector, central excise (appeals) observed that in this case the lower price for outstation customers is not regional discount and that the different prices charged from different outstation customers were not the discounted prices but were individually varied lower prices due to varying freight, octroi, sales tax etc., the class of buyer remaining the same.9. the case was posted for hearing on 10-9-1993 when shri n.v. raghavan iyer, advocate appeared for the appellants. shri prabhat kumar, sdr represented the respondent.10. shri n.v. raghavan iyer, the learned advocate referred to the activities of the appellant as a manufacturer of detergent cakes and detergent powder. price lists have been filed for delhi distributors as well as for outside distributors in part-i of the price list proforma.the prices to outside buyers were lower than the prices to delhi buyers. there was no written agreement with the distributors. the learned advocate agreed that filing of the price lists in part-i was incorrect, but added that the format of the price lists was immaterial in the circumstances of the case. he stated that in the show cause notice no grounds have been taken to reject their prices. he also mentioned that the collector had drawn incorrect inferences while relying upon the tribunal's decision.11. in support of his arguments, the learned advocate relied upon the following decisions :- (1) gujarat state fertilisers company v. union of india - 1980 (61) e.l.t. 397 (guj.) - regional discount is essentially a discount which may vary between one purchaser to another depending upon the region in which they carry on business. being given as a percentage deduction from the list price, it is a trade discount within the meaning of the explanation to section 4 of the act. (2) music india ltd. v. union of india - 1986 (25) e.l.t. 1032 (bom.) - regional discount is deductible from the sale price if established under agreements or under terms of sale or by established practice.sharada silicate and chemicals industries v. collector, central excise - 1979 (4) e.l.t. (j 20) (mad.) - charging of different prices from different buyers if based on rational commercial basis for giving more liberal trade concession to one customer against the other and solely motivated by trade consideration, should be taken as the assessable value.12. shri prabhat kumar, the learned sdr submitted that the facts and circumstances of the case were clear. the price at which the goods were sold at the factory gate was available, and in terms of the supreme court decision in the case of indian oxygen ltd. v. collector, central excise -1988 (36) e.l.t. 723 (sc), all assessments have to be done on the basis of those factory gate sales price. there was no issue of trade discount, as trade discount of 5% was available for both the buyers - for delhi region and outside delhi.13. in support of his arguments, the learned sdr relied upon the following decisions :-shyam glass works v. inspector, central excise- 1979 (4) e.l.t. (j 460) (all.) - this decision relates to the period 1-7-1962 to 30-6-1963 when old section 4 was on the statute book. it was observed therein that the petitioners were not entitled to the deduction of discount given to the customers in a manner which is not uniform;shakti insulated wires pvt. ltd. v. c.c.e. -1990 (49) e.l.t. 554 (tri.);collector, central excise v. orissa cement ltd. -1984 (17) e.l.t. 161 (tribunal).14. in reply, the learned advocate stated that there could be different prices to different class of buyers. he further stated that the definition of wholesale trade was not exhaustive but only illustrative.15. we have carefully gone through the facts and circumstances of the case. the submissions made by the learned advocate on behalf of the appellant and by the learned sdr on behalf of the respondent have also been gone through.16. the point that arises for our consideration on the submissions made by shri n.v. raghavan iyer, the learned advocate for the appellant, is as to whether the prices at which the detergent cakes/powder were sold by the appellant on the wholesale basis to their outstation distributors could be taken as the wholesale cash price under section 4(1) (a) of the act, or the assessments should be made on the basis of the higher prices declared for sale to delhi distributors. "section 4. valuation of excisable goods for purposes of charging of duty of excise - (1) where under this act, the duty of excise is chargeable on any excisable goods with reference to value, such value, shall, subject to the other provisions of this section, be deemed to be ~ (a) the normal price thereof, that is to say the price at which such goods are ordinarily sold by the assessee to a buyer in the course of wholesale trade for delivery at the time and place of removal, where the buyer is not a related person and the price is the sole consideration for the sale." 18. it is seen that the assessee had declared their prices as inclusive of the cost of packing. their selling rates were also inclusive of central excise duty. trade discount/cash discount of 5% was claimed for deduction. in some cases deduction towards some scheme was also claimed. in the price lists for outstation distributors, a deduction of 4% towards central sales tax was also claimed. the value so arrived at after such deductions was claimed for approval, and was approved by the proper central excise officers.union of india v. bombay tyre international - 1983 (14) e.l.t. 1896 (sc), the hon'ble supreme court have observed in para 33 of their judgment that" the normal price mentioned in the new section 4(1 )(a) is the price at which the goods are ordinarily sold by the assessee in the course of wholesale trade. it is the wholesale price charged by him. it is a price which may vary according to the first proviso to the new section 4(1)(a) with different classes of buyers".20. in para 34 it is added that "the value of excisable goods determined under new section 4(1)(a) may also vary according to certain circumstances is evident from the three clauses of the proviso to that clause clause (1) recognises that in the normal practice of wholesale trade the same class of goods may be sold by the assessee at different prices to different classes of buyers; in that event each such price shall subject to the other conditions of clause (a) be deemed to be the normal price of such goods in relation to each class of buyers".21. in the case before us there is nothing to suggest that the sale to the outstation distributors was not a sale at a commercial price, or that they were a favoured buyer from whom the low price was charged because of extra commercial considerations, or that the transactions with them were not at arm's length and in the usual course of business.22. under proviso (i) under section 4(1) (a) of the act, it has been provided that:- "(i) where, in accordance with the normal practice of the wholesale trade in such goods, such goods are sold by the assessee at different prices to different classes of buyers (not being related persons) each such price shall, subject to the existence of the other circumstances specified in clause (a), be deemed to be the normal price of such goods in relation to each such class of buyers"; 23. as what is "the normal practice of the wholesale trade" has to be determined on trade considerations. as regards the sale "by the assessee at different prices to different classes of buyers", it appears reasonable to assume that it is for the assessee to classify his buyers according to his commercial considerations; of course, the classification has to be rational and identifiable, based purely on commercial considerations. it could not be arbitrary or capricious. if the classification of his buyers by the assessee is within the basic scheme for determination of the assessable value under section 4 of the act, then no objection could reasonably be raised by the central excise department for determining the assessable value on the basis of "different prices to different classes of buyers (not being related persons)." 24. now let us examine whether in the circumstances of the case before us, the delhi distributors and the outstation distributors of the appellants, could be considered as different classes of buyers.25. "wholesale dealers" has been defined under section 2(k) of the act as under :- "wholesale dealer" means a person who buys or sells excisable goods wholesale for the purpose of trade or manufacture, and includes a broker or commission agent who, in addition to making contracts for the sale or purchase of excisable goods for others, stocks such goods belonging to others as an agent for the purpose of sale." 26 wholesale dealer could be a trader, manufacturer, broker, commission agent, contractor and a stockist.krishi utpadan mandi samiti v. shanker industries - 1993 air scw 762 "where the legislature uses the words 'means' and 'includes', such definition is to be given a wider meaning and is not exhaustive or restricted to the items contained or included in such definition." "wholesale trade" means sales to dealers, industrial consumers, government, local authorities and other buyers, who or which purchase their requirements otherwise than in retail." 29. a buyer in the course of wholesale trade could be a dealer, industrial consumer, government, local authority or any other buyers.30. the definition of "wholesale trade" in section 4(4)(e) of the act is a comprehensive definition which covers all the wholesale dealers and all the wholesale buyers, who purchase their requirements in wholesale.31. the expression 'different classes of buyers' occurring in the proviso (i) to section 4(1)(a) of the act, read with the definition of 'wholesale dealer' under section 2(k), and of 'wholesale trade' under section 4(4)(e) appear to cover not only a trader, manufacturer, broker, commission agent, contractor, stockist, industrial consumer, government and local authority, but also different dealers and buyers, who deal in and buy for re-sale, or purchase their requirements in wholesale.32. there appears no doubt that all the wholesale dealers and all the wholesale buyers in the whole of the country could not be taken to form a single class of buyers.33. viewed in this light, delhi distributors and outstation distributors of the appellants in the case before us, are different classes of buyers for the purposes of section 4 of the act.34. it follows from the above that each of the price at which the goods were sold to the delhi distributors and to the outstation distributors can be deemed to be the normal price of such goods in relation to each of the buyers.35. the price lists were filed by the assessee, both for delhi distributors and outstation distributors, in price list proforma in part i, although separately. during the course of his arguments, before us, the learned advocate on behalf of the appellants, admitted that filing of the price lists in part i was incorrect. in the circumstances of this case, however, we consider that the correct decision could only be arrived at if the incorrect filing of price lists in part i of the price list proforma, is not taken into account. in the case of d.c.w.ltd. v. c.c.e. - 1992 (62) e.l.t. 153 (tribunal), the tribunal in para 14 of their order had observed as under :- "the price lists are filed for the purpose of making assessment and for the convenience of the department as well as the assessee to ascertain the price of the manufacture, clearance, deductions claimed etc. the filing of a price list under a particular part, say in part i, ii, iii may not entirely be relevant in determining whether the price list represents the price under section 4(1)(a) in view of the various provisos provided under section 4(1). in other words, as long as it is a sale to a class of buyers indicated in the earlier paragraphs in the course of wholesale trade at the factory gate and as long as the buyer is not a related person and the price is the sole consideration for the sale, it represents the price under section 4(1 )(a). therefore, the reasoning of the collector that since there was no part-i price approved, the price approved under part ii cannot be treated as the price under section 4(1)(a) of the act is based on a misconception of the provisions of the act."sharada silicate and chemicals industries v. c.c.e. - 1979 (4) e.l.t. (j 20) (mad.), the madras high court had held "that the price charged by the petitioner firm from each of its customers even though it varies from customer to customer has to be taken as the wholesale cash price for the purpose of section 4 of the act".37. relying upon the supreme court decision in the case of a.k. roy v.voltes ltd. - 1977 (1) e.l.t. 177, the madras high court observed in that case that "it cannot be disputed that excise duty would be leviable on the prices charged by the manufacturer provided it is charged on a wholesale basis even though certain concessions are made available to the purchaser so long as those concessions are motivated by trade considerations and do not flow from extra commercial considerations".collector, central excise v. indian oxygen ltd. - 1988 (36) e.l.t. 730 (sc); the hon'ble supreme court had observed in para 7 that "if gases had been sold to different classes of buyers at different rates, it is possible that there might be different markets for the same".39. according to the departmental clarification, even in cases where goods are sold to buyers of the same class, more than one price can be the normal price. (board's letter f. no. 315/12/75cx.10, dated 12-3-1976, referred to at page 250 of the centax publications on valuation and price list under central excise - second edition).indian oxygen ltd. v.c.c.e., 1988 (36) e.l.t. 723 (sc) is not applicable to the facts and circumstances of this case as the goods had not been sold from any depot but in both the cases, for delhi distributors and outstation distributors, the goods have been sold at the factory gate, but on varying rates.41. in the case of godrej and boyce manufacturing company pvt. ltd, v.union of india, 1984 (18) e.l.t. 172 (bom.), the matter related to the packing of refrigerators. there was a packing of polythene cover for the refrigerators sold to the wholesale dealers in bombay and a double faced corrugated fibre box with fitments and wooden box for the refrigerators sold to the wholesale dealers outside bombay. it was in this context that the bombay high court observed that "wholesale dealers in india cannot be considered as belonging to different classes simply because they are located in different towns or cities" and that "different price lists for wholesalers in different areas are not contemplated under section 4(1)(a)(i)".42. the hon'ble bombay high court did not object to the higher price for the refrigerators sold and delivered to wholesale dealers outside bombay. in that case the petitioners were levying a separate charge for their secondary packing under a separate invoice. this practice has been in vogue for a long time. the bombay high court had held that the petitioners were entitled to have the value of refrigerators determined for the purpose of excise duty without the addition of the charge for extra packing. in the case before us, there is no dispute about the packing or the packing charges.shakti insulated wires pvt. ltd. v. c.c.e. - 1990 (49) e.l.t. 554 (tribunal), relied upon by the assistant collector, central excise and referred to by the collector, central excise (appeals), the matter related to contracted prices. it was noted by the tribunal that what was termed as contract was merely a confirmation order signed only by the appellants and as such on that very basis, it could not be held to be a contract. the tribunal came to a finding in that case that the contracted parties were not in any way different from the other wholesale dealers.44. the decision in the case of ccc.e. v. orissa cement ltd. - 1984 (17) e.l.t. 161 (tribunal) is also not relevant to the facts and circumstances of the case before us. in that case, the point for consideration before the tribunal was whether the firebricks and mortar both excisable under item no. 68 of the erstwhile central excise tariff, fall under the same class of goods for the purposes of rule 173l(3)(iii) of the central excise rules, 1944. the tribunal had held that the firebricks and mortar fall in the same class of goods. the context and the purpose of interpretation of the expression "classes of buyers" are entirely different.45. thus, taking all the relevant considerations into account, we consider in the circumstances of this case, on the basis of the facts on record, that the appellant's delhi distributors and their outstation distributors are two different classes of buyers, for the purposes of proviso (i) to section 4(1 )(a) of the act, and accordingly each price charged from these different classes of buyers is the normal price in relation to each of them.46. as a result, we accept the appeal and set aside the impugned order with consequential relief to the appellants, if any.

Judgment:
1. This is an appeal filed by M/s. Gora Mal Hari Ram Ltd., New Delhi, against the Order-in-Appeal No. 134/CE/Appeal/DLH/92, dated 30-4-1992, passed by the Collector, Central Excise (Appeals), New Delhi.

2. The appellants were engaged in the manufacture of detergent cakes and detergent/washing powder. The goods were sold by them through their distributors. They were having distributors for Delhi region and distributors for outstation. They filed separate price lists for Delhi distributors and for outstation distributors. Higher prices were declared for Delhi distributors and lower prices were declared for outstation distributors. In both the cases the sales were effected at the factory gate, and in both the cases the price lists were filed in Part I of the price list proforma. Part I of the price list proforma related to the determination of value for goods sold to unrelated buyers in the course of wholesale trade, under the main definition case, in terms of the provisions of Section 4(1 )(a) of the Central Excises and Salt Act, 1944 (hereinafter referred to as the 'Act').

3. It was alleged in the show cause notice that the Delhi distributors and the outstation distributors were the same class of buyers, and that the class of buyers did not change merely because they are located in different regions, and that the difference in the prices could not be based upon territorial segregation.

4. According to the appellants, different prices were charged by them from their different classes of buyers, on the basis of territorial classification of their Delhi distributors and outstation distributors.

The reason for charging lower rates from their outstation distributors was to meet the competition at outstation places, and to develop new markets. They submitted that in the outstation markets, they have to compete with other manufacturers of the area who are closer to such markets and who are located in such outstation markets. It was also submitted that the incidence of local taxes and other charges had also been taken into account while fixing their prices for outstation distributors.

5. The Assistant Collector, Central Excise, Division HI, New Delhi, relying upon the Tribunal's decision in the case of Shakti Insulated Wires Pvt. Ltd. v. Collector of Central Excise - 1990 (49) E.L.T. 554 (Tri.), confirmed the demand.

6. While filing the appeal to the Collector, Central Excise (Appeals), New Delhi, the appellants referred to their price pattern as "providing different discounts for different classes of buyers located in different territories." They further stated that "in the price list the appellant had indicated the respective wholesale prices for the respective territories, instead of distinguishing them by reference to discounts." 7. The Collector, Central Excise (Appeals), after examining the provisions of Section 4(1)(a) of the Act, observed that the prices charged by the appellants from their outstation customers did not satisfy the strict requirement of that section. He further observed that the wholesale dealers by themselves form a class and even though they are located at different places, they can only form one class of buyer. In this connection, he referred to the Tribunal's decision in the case of Collector, Central Excise v. Orissa Cement Ltd. - 1984 (17) E.L.T. 161 (Tribunal), and the Bombay High Court's decision in the case of Godrej & Boyce Manufacturing Company Pvt. Ltd. v. Union of India, 1984 (18) E.L.T. 172 (Bom.).

8. The Collector, Central Excise (Appeals) observed that in this case the lower price for outstation customers is not regional discount and that the different prices charged from different outstation customers were not the discounted prices but were individually varied lower prices due to varying freight, octroi, sales tax etc., the class of buyer remaining the same.

9. The case was posted for hearing on 10-9-1993 when Shri N.V. Raghavan Iyer, Advocate appeared for the appellants. Shri Prabhat Kumar, SDR represented the respondent.

10. Shri N.V. Raghavan Iyer, the learned Advocate referred to the activities of the appellant as a manufacturer of detergent cakes and detergent powder. Price lists have been filed for Delhi distributors as well as for outside distributors in Part-I of the price list proforma.

The prices to outside buyers were lower than the prices to Delhi buyers. There was no written agreement with the distributors. The learned Advocate agreed that filing of the price lists in Part-I was incorrect, but added that the format of the price lists was immaterial in the circumstances of the case. He stated that in the show cause notice no grounds have been taken to reject their prices. He also mentioned that the Collector had drawn incorrect inferences while relying upon the Tribunal's decision.

11. In support of his arguments, the learned Advocate relied upon the following decisions :- (1) Gujarat State Fertilisers Company v. Union of India - 1980 (61) E.L.T. 397 (Guj.) - Regional discount is essentially a discount which may vary between one purchaser to another depending upon the region in which they carry on business. Being given as a percentage deduction from the list price, it is a trade discount within the meaning of the explanation to Section 4 of the Act.

(2) Music India Ltd. v. Union of India - 1986 (25) E.L.T. 1032 (Bom.) - Regional discount is deductible from the sale price if established under agreements or under terms of sale or by established practice.Sharada Silicate and Chemicals Industries v. Collector, Central Excise - 1979 (4) E.L.T. (J 20) (Mad.) - Charging of different prices from different buyers if based on rational commercial basis for giving more liberal trade concession to one customer against the other and solely motivated by trade consideration, should be taken as the assessable value.

12. Shri Prabhat Kumar, the learned SDR submitted that the facts and circumstances of the case were clear. The price at which the goods were sold at the factory gate was available, and in terms of the Supreme Court decision in the case of Indian Oxygen Ltd. v. Collector, Central Excise -1988 (36) E.L.T. 723 (SC), all assessments have to be done on the basis of those factory gate sales price. There was no issue of trade discount, as trade discount of 5% was available for both the buyers - for Delhi region and outside Delhi.

13. In support of his arguments, the learned SDR relied upon the following decisions :-Shyam Glass Works v. Inspector, Central Excise- 1979 (4) E.L.T. (J 460) (All.) - This decision relates to the period 1-7-1962 to 30-6-1963 when old Section 4 was on the statute book. It was observed therein that the petitioners were not entitled to the deduction of discount given to the customers in a manner which is not uniform;Shakti Insulated Wires Pvt. Ltd. v. C.C.E. -1990 (49) E.L.T. 554 (Tri.);Collector, Central Excise v. Orissa Cement Ltd. -1984 (17) E.L.T. 161 (Tribunal).

14. In reply, the learned Advocate stated that there could be different prices to different class of buyers. He further stated that the definition of wholesale trade was not exhaustive but only illustrative.

15. We have carefully gone through the facts and circumstances of the case. The submissions made by the learned Advocate on behalf of the appellant and by the learned SDR on behalf of the respondent have also been gone through.

16. The point that arises for our consideration on the submissions made by Shri N.V. Raghavan Iyer, the learned Advocate for the appellant, is as to whether the prices at which the detergent cakes/powder were sold by the appellant on the wholesale basis to their outstation distributors could be taken as the wholesale cash price under Section 4(1) (a) of the Act, or the assessments should be made on the basis of the higher prices declared for sale to Delhi distributors.

"Section 4. Valuation of excisable goods for purposes of charging of duty of excise - (1) Where under this Act, the duty of excise is chargeable on any excisable goods with reference to value, such value, shall, subject to the other provisions of this section, be deemed to be ~ (a) the normal price thereof, that is to say the price at which such goods are ordinarily sold by the assessee to a buyer in the course of wholesale trade for delivery at the time and place of removal, where the buyer is not a related person and the price is the sole consideration for the sale." 18. It is seen that the assessee had declared their prices as inclusive of the cost of packing. Their selling rates were also inclusive of Central Excise duty. Trade discount/cash discount of 5% was claimed for deduction. In some cases deduction towards some scheme was also claimed. In the price lists for outstation distributors, a deduction of 4% towards Central Sales Tax was also claimed. The value so arrived at after such deductions was claimed for approval, and was approved by the proper Central Excise Officers.Union of India v. Bombay Tyre International - 1983 (14) E.L.T. 1896 (SC), the Hon'ble Supreme Court have observed in Para 33 of their judgment that" the normal price mentioned in the new Section 4(1 )(a) is the price at which the goods are ordinarily sold by the assessee in the course of wholesale trade. It is the wholesale price charged by him. It is a price which may vary according to the first proviso to the new Section 4(1)(a) with different classes of buyers".

20. In Para 34 it is added that "the value of excisable goods determined under new Section 4(1)(a) may also vary according to certain circumstances is evident from the three clauses of the proviso to that clause Clause (1) recognises that in the normal practice of wholesale trade the same class of goods may be sold by the assessee at different prices to different classes of buyers; in that event each such price shall subject to the other conditions of clause (a) be deemed to be the normal price of such goods in relation to each class of buyers".

21. In the case before us there is nothing to suggest that the sale to the outstation distributors was not a sale at a commercial price, or that they were a favoured buyer from whom the low price was charged because of extra commercial considerations, or that the transactions with them were not at arm's length and in the usual course of business.

22. Under proviso (i) under Section 4(1) (a) of the Act, it has been provided that:- "(i) where, in accordance with the normal practice of the wholesale trade in such goods, such goods are sold by the assessee at different prices to different classes of buyers (not being related persons) each such price shall, subject to the existence of the other circumstances specified in clause (a), be deemed to be the normal price of such goods in relation to each such class of buyers"; 23. As what is "the normal practice of the wholesale trade" has to be determined on trade considerations. As regards the sale "by the assessee at different prices to different classes of buyers", it appears reasonable to assume that it is for the assessee to classify his buyers according to his commercial considerations; of course, the classification has to be rational and identifiable, based purely on commercial considerations. It could not be arbitrary or capricious. If the classification of his buyers by the assessee is within the basic scheme for determination of the assessable value under Section 4 of the Act, then no objection could reasonably be raised by the Central Excise department for determining the assessable value on the basis of "different prices to different classes of buyers (not being related persons)." 24. Now let us examine whether in the circumstances of the case before us, the Delhi distributors and the outstation distributors of the appellants, could be considered as different classes of buyers.

25. "Wholesale dealers" has been defined under Section 2(k) of the Act as under :- "Wholesale dealer" means a person who buys or sells excisable goods wholesale for the purpose of trade or manufacture, and includes a broker or commission agent who, in addition to making contracts for the sale or purchase of excisable goods for others, stocks such goods belonging to others as an agent for the purpose of sale." 26 Wholesale dealer could be a trader, manufacturer, broker, commission agent, contractor and a stockist.Krishi Utpadan Mandi Samiti v. Shanker Industries - 1993 AIR SCW 762 "where the legislature uses the words 'means' and 'includes', such definition is to be given a wider meaning and is not exhaustive or restricted to the items contained or included in such definition." "wholesale trade" means sales to dealers, industrial consumers, Government, local authorities and other buyers, who or which purchase their requirements otherwise than in retail." 29. A buyer in the course of wholesale trade could be a dealer, industrial consumer, Government, local authority or any other buyers.

30. The definition of "wholesale trade" in Section 4(4)(e) of the Act is a comprehensive definition which covers all the wholesale dealers and all the wholesale buyers, who purchase their requirements in wholesale.

31. The expression 'different classes of buyers' occurring in the proviso (i) to Section 4(1)(a) of the Act, read with the definition of 'wholesale dealer' under Section 2(k), and of 'wholesale trade' under Section 4(4)(e) appear to cover not only a trader, manufacturer, broker, commission agent, contractor, stockist, industrial consumer, Government and local authority, but also different dealers and buyers, who deal in and buy for re-sale, or purchase their requirements in wholesale.

32. There appears no doubt that all the wholesale dealers and all the wholesale buyers in the whole of the country could not be taken to form a single class of buyers.

33. Viewed in this light, Delhi distributors and outstation distributors of the appellants in the case before us, are different classes of buyers for the purposes of Section 4 of the Act.

34. It follows from the above that each of the price at which the goods were sold to the Delhi distributors and to the outstation distributors can be deemed to be the normal price of such goods in relation to each of the buyers.

35. The price lists were filed by the assessee, both for Delhi distributors and outstation distributors, in price list proforma in Part I, although separately. During the course of his arguments, before us, the learned Advocate on behalf of the appellants, admitted that filing of the price lists in Part I was incorrect. In the circumstances of this case, however, we consider that the correct decision could only be arrived at if the incorrect filing of price lists in Part I of the price list proforma, is not taken into account. In the case of D.C.W.Ltd. v. C.C.E. - 1992 (62) E.L.T. 153 (Tribunal), the Tribunal in para 14 of their order had observed as under :- "The price lists are filed for the purpose of making assessment and for the convenience of the Department as well as the assessee to ascertain the price of the manufacture, clearance, deductions claimed etc. The filing of a price list under a particular part, say in Part I, II, III may not entirely be relevant in determining whether the price list represents the price under Section 4(1)(a) in view of the various provisos provided Under Section 4(1). In other words, as long as it is a sale to a class of buyers indicated in the earlier paragraphs in the course of wholesale trade at the factory gate and as long as the buyer is not a related person and the price is the sole consideration for the sale, it represents the price Under Section 4(1 )(a). Therefore, the reasoning of the Collector that since there was no Part-I price approved, the price approved under Part II cannot be treated as the price Under Section 4(1)(a) of the Act is based on a misconception of the provisions of the Act."Sharada Silicate and Chemicals Industries v. C.C.E. - 1979 (4) E.L.T. (J 20) (Mad.), the Madras High Court had held "that the price charged by the petitioner firm from each of its customers even though it varies from customer to customer has to be taken as the wholesale cash price for the purpose of Section 4 of the Act".

37. Relying upon the Supreme Court decision in the case of A.K. Roy v.Voltes Ltd. - 1977 (1) E.L.T. 177, the Madras High Court observed in that case that "it cannot be disputed that excise duty would be leviable on the prices charged by the manufacturer provided it is charged on a wholesale basis even though certain concessions are made available to the purchaser so long as those concessions are motivated by trade considerations and do not flow from extra commercial considerations".Collector, Central Excise v. Indian Oxygen Ltd. - 1988 (36) E.L.T. 730 (SC); the Hon'ble Supreme Court had observed in Para 7 that "If gases had been sold to different classes of buyers at different rates, it is possible that there might be different markets for the same".

39. According to the departmental clarification, even in cases where goods are sold to buyers of the same class, more than one price can be the normal price. (Board's letter F. No. 315/12/75CX.10, dated 12-3-1976, referred to at page 250 of the Centax Publications on Valuation and Price List under Central Excise - Second Edition).Indian Oxygen Ltd. v.C.C.E., 1988 (36) E.L.T. 723 (SC) is not applicable to the facts and circumstances of this case as the goods had not been sold from any depot but in both the cases, for Delhi distributors and outstation distributors, the goods have been sold at the factory gate, but on varying rates.

41. In the case of Godrej and Boyce Manufacturing Company Pvt. Ltd, v.Union of India, 1984 (18) E.L.T. 172 (Bom.), the matter related to the packing of refrigerators. There was a packing of polythene cover for the refrigerators sold to the wholesale dealers in Bombay and a double faced corrugated fibre box with fitments and wooden box for the refrigerators sold to the wholesale dealers outside Bombay. It was in this context that the Bombay High Court observed that "wholesale dealers in India cannot be considered as belonging to different classes simply because they are located in different towns or cities" and that "different price lists for wholesalers in different areas are not contemplated Under Section 4(1)(a)(i)".

42. The Hon'ble Bombay High Court did not object to the higher price for the refrigerators sold and delivered to wholesale dealers outside Bombay. In that case the petitioners were levying a separate charge for their secondary packing under a separate invoice. This practice has been in vogue for a long time. The Bombay High Court had held that the petitioners were entitled to have the value of refrigerators determined for the purpose of excise duty without the addition of the charge for extra packing. In the case before us, there is no dispute about the packing or the packing charges.Shakti Insulated Wires Pvt. Ltd. v. C.C.E. - 1990 (49) E.L.T. 554 (Tribunal), relied upon by the Assistant Collector, Central Excise and referred to by the Collector, Central Excise (Appeals), the matter related to contracted prices. It was noted by the Tribunal that what was termed as contract was merely a confirmation order signed only by the appellants and as such on that very basis, it could not be held to be a contract. The Tribunal came to a finding in that case that the contracted parties were not in any way different from the other wholesale dealers.

44. The decision in the case of CcC.E. v. Orissa Cement Ltd. - 1984 (17) E.L.T. 161 (Tribunal) is also not relevant to the facts and circumstances of the case before us. In that case, the point for consideration before the Tribunal was whether the firebricks and mortar both excisable under Item No. 68 of the erstwhile Central Excise Tariff, fall under the same class of goods for the purposes of Rule 173L(3)(iii) of the Central Excise Rules, 1944. The Tribunal had held that the firebricks and mortar fall in the same class of goods. The context and the purpose of interpretation of the expression "classes of buyers" are entirely different.

45. Thus, taking all the relevant considerations into account, we consider in the circumstances of this case, on the basis of the facts on record, that the appellant's Delhi distributors and their outstation distributors are two different classes of buyers, for the purposes of proviso (i) to Section 4(1 )(a) of the Act, and accordingly each price charged from these different classes of buyers is the normal price in relation to each of them.

46. As a result, we accept the appeal and set aside the impugned order with consequential relief to the appellants, if any.