Custom, Excise & Service Tax Tribunal
Phaarmasia Ltd vs Commissioner Of Customs ,Central ... on 26 March, 2014
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL SOUTH ZONAL BENCH BANGALORE Final Order No .20408-20409 / 2014 Application(s) Involved: E/Stay/1548/2011 in E/2525/2011-DB E/Stay/32/2012 in E/84/2012-DB Appeal(s) Involved: E/2525/2011-DB E/84/2012-DB [Arising out of Order in Appeal 62-2011 dated 24/06/2011 & No.77/2011 dt. 12/10/2011 passed by CC,CE&ST(Appeals), Hyderabad-II] PHAARMASIA LTD PLOT NO.16, PHASE -III, IDA, JEEDIMETLA, HYDERABAD.500 055 Appellant(s) Versus Commissioner of Customs ,Central Excise and Service Tax - HYDERABAD-IV CR Building, L.B. Staidum, Basheerbagh, HYDERABAD, ANDHRA PRADESH 500004 Respondent(s)
Appearance:
Shri Dayanand, Chartered Accountant For the Appellant Dr. A.K. Nigam, Addl. Commissioner(AR) For the Respondent CORAM:
HON'BLE SHRI B.S.V.MURTHY, TECHNICAL MEMBER HON'BLE SHRI S.K. MOHANTY, JUDICIAL MEMBER Date of Hearing: 26/03/2014 Date of Decision: 26/03/2014 Order Per : B.S.V.MURTHY The issue involved in both the appeals is common and same and therefore both the appeals are taken up together. After hearing both sides for some time, we find that the issue lies in a narrow compass and appeals can be decided finally at this stage itself. Accordingly, the requirement of predeposit is waived and appeals are taken up for final disposal.
2. Appellants cleared Dermadew Aloe cream, Dermadew aloe lotion and Dermadew coloe lotion by assessing the value of the goods under Section 4A of the Central Excise Act, 1944. However the physicians samples of the above goods meant for free distribution where the MRP or RSP was not required to be affixed were cleared by assessing under Section 4(1)(a) of Central Excise Act, 1944. Taking a view that the assessable value of physicians samples also should have been determined under Rule 4 of Central Excise Valuation Rules, 2000 i.e. the value should have been determined based on the MRP of the goods, proceedings were initiated which has been culminated in confirmation of the duty demand with interest and also imposition of penalty equal to the duty demanded.
3. Heard both sides. The learned counsel for the appellant relied upon precedent decisions of this Tribunal in the case of Meyer Health Care Pvt. Ltd. Vs. Asst. CCE, Bangalore-II [2009(245) ELT 298 (Tri. Bang.)] and the Stay Order No.117 dt. 01/02/2010 in the case of M/s.Hi-Tech Pharmaceuticals Pvt. Ltd. in appeal No.E/757/2009 to submit that where physicians samples are manufactured and sold to the brand name owner and where transaction value is available, the assessment has to be based on transaction value as per the provision of Section 4(1)(a). The learned AR would submit that in this case the assessee has cleared the goods on the basis of a notional price. It was also observed in the show-cause notice that the appellants have adopted a self-determined notional value which is less than 25% of the proportionate MRP value of the comparable goods for payment of duty. This stand taken in the show-cause notice was adopted by both the lower authorities for confirming the demand and imposition of penalty. It was submitted by the learned counsel that the value was based on purchase orders and invoices and it was not a self-determined value but mutually agreed price between the manufacturer and the buyer. Further there is absolutely no evidence to show that the value adopted by the assessee in this case was not in accordance with the provisions of Section 4. There is absolutely no basis on a prima facie basis to come to the conclusion that it was a notional value. Learned AR also relied upon the decision in the case of Allianz Bio Sciences Pvt. Ltd. Vs. CCE, Puducherry [2012(283) ELT 284 (Tri. Chennai)] which on going through we find, is in assessees favour. Another decision relied upon by the learned AR is the decision of the Tribunal in the case of Cadila Pharmaceuticals Ltd. Vs. CCE, Ahmedabad-II [2008(232) ELT 245 (Tri. LB)]. In this case also, the Tribunal was considering a situation where assessee was clearing physician samples as free supplies and there was no sale.
4. The above observations would show that the reliance by the learned counsel for the appellant on the decisions of the Tribunal is appropriate and applicable and as already observed by us, the facts on record show that there is no basis for the conclusions reached by the original authorities and further the two precedent decisions relied upon by the learned AR are not applicable. In view of the above discussion, we set aside the impugned order and allow the appeals with consequential relief, if any to the appellants.
(Operative portion of this order was pronounced in open court on conclusion of the hearing ) S.K. MOHANTY JUDICIAL MEMBER B.S.V.MURTHY TECHNICAL MEMBER Raja