Custom, Excise & Service Tax Tribunal
Essel International Limited vs New Delhi(Icd Tkd) on 28 February, 2023
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL
NEW DELHI
PRINCIPAL BENCH - COURT NO. 3
Customs Appeal No. 51671 of 2019
(Arising out of Order-in-Original No. 03/2019 dated 14.02.2019 passed by the Principal
Commissioner of Customs (Import), Tughlakabad, New Delhi)
M/s Essel International Limited Appellant
VERSUS
Commissioner of Customs, Tughlakabad, Respondent
New Delhi Appearance Shri A.R. Madhav Rao, Shri Tushar Joshi & Shri Mukundar Rao, Advocates - for the Appellant Shri Nagendra Yadav & Shri Rakesh Kumar, Authorized Representatives - for the Respondent CORAM:
HON'BLE MR. P.V. SUBBA RAO, MEMBER (TECHNICAL) HON'BLE MS. BINU TAMTA, MEMBER (JUDICIAL) DATE OF HEARING/DECISION: 28/02/2023 Final Order No. 50392/2023 P.V. Subba Rao:
M/s Essel International Limited, New Delhi filed this appeal to assail the order-in-original (de novo) dated 14.02.2019 passed by the Principal Commissioner of Customs (Import), Inland Container Depot, Tughlakabad 1, the operative part of which is as follows:
―(i) I confirm the demand of differential duty amounting to Rs. 1,53,80,707/- (Rs. One Crore Fifty Three Lakhs Eighty Thousand Seven Hundred and Seven only) against M/s Essel International Ltd., New Delhi, under proviso to Section 28(1) of the Customs Act, 1 Impugned order 2 C/51671/2019 1962. I order for appropriation of the amounts already deposited by the party vide TR-6 Challans dated 12.10.2010, 13.10.2010 and 30.10.2010 against above demand.
(ii) I confirm the demand of interest of Rs. 17,81,869/- on the above said differential duty under Section 28 AB of the Customs Act, 1962 against M/s Essel International Ltd., New Delhi and order for appropriation of the amount already deposited vide TR-6 Challans dated 12.10.2010 and 30.10.2010 against above demand.
(iii) I impose a penalty of Rs. 50,00,000/- (Rs. Fifty lacs only) under Section 112(a) and (b) of the Customs Act, 1962 on M/s Essel International Ltd., New Delhi, and order for appropriation of amount already deposited by M/s Essel International Ltd., New Delhi vide TR-6 Challans dated 13.10.2010 and 30.10.2010 against this penalty.‖
2. The appellant imported Set Top Boxes for television sets and sold them to M/s Dish TV Limited. Goods which are imported into the country are chargeable to Basic Customs Duty as per Section 12 of the Customs Act at the rates applicable as per Customs Tariff. They are also chargeable to Additional Duty of Customs as per Section 3 of the Customs Tariff, 1975 at the rates of excise duty applicable to such goods manufactured in India. Thus, the additional duty of customs, is a duty of customs but is levied at rates applicable to central excise. Duties of central excise can be levied based on quantity (specific rate of duty) or value (ad valorem rate of duty). If the duty is to be levied based on the value, such valuation should be done as per Section 4 read with Central Excise Valuation Rules. However, in respect of some goods which are notified under Section 4A in relation to which it is required to declare the retail sale price under the Standards of Weights and Measures Act, 1976, the duty shall be paid on the retail sale price after an abatement as indicated in the notification. Section 4A of the Central Excise Act reads as follows:
―4A. Valuation of excisable goods with reference to retail sale price.--
(1) The Central Government may, by notification in the Official Gazette, specify any goods, in relation to which it is required, under the provisions of the Standards of Weights and Measures 3 C/51671/2019 Act, 1976 (60 of 1976) or the rules made thereunder or under any other law for the time being in force, to declare on the package thereof the retail sale price of such goods, to which the provisions of sub-section (2) shall apply.
(2) Where the goods specified under sub-section (1) are excisable goods and are chargeable to duty of excise with reference to value, then, notwithstanding anything contained in section 4, such value shall be deemed to be the retail sale price declared on such goods less such amount of abatement, if any, from such retail sale price as the Central Government may allow by notification in the Official Gazette.
(3) The Central Government may, for the purpose of allowing any abatement under sub-section (2), take into account the amount of duty of excise, sales tax and other taxes, if any, payable on such goods.
(4) Where any goods specified under sub-section (1) are excisable goods and the manufacturer--
(a) removes such goods from the place of manufacture, without declaring the retail sale price of such goods on the packages or declares a retail sale price which is not the retail sale price as required to be declared under the provisions of the Act, rules or other law as referred to in sub-section (1); or
(b) tampers with, obliterates or alters the retail sale price declared on the package of such goods after their removal from the place of manufacture, then, such goods shall be liable to confiscation and the retail sale price of such goods shall be ascertained in the prescribed manner and such price shall be deemed to be the retail sale price for the purposes of this section.
Explanation 1.--For the purposes of this section, "retail sale price"
means the maximum price at which the excisable goods in packaged form may be sold to the ultimate consumer and includes all taxes, local or otherwise, freight, transport charges, commission payable to dealers, and all charges towards advertisement, delivery, packing, forwarding and the like and the price is the sole consideration for such sale: Provided that in case the provisions of the Act, rules or other law as referred to in sub- section (1) require to declare on the package, the retail sale price excluding any taxes, local or otherwise, the retail sale price shall be construed accordingly.
Explanation 2.--For the purposes of this section,--
(a) where on the package of any excisable goods more than one retail sale price is declared, the maximum of such retail sale prices shall be deemed to be the retail sale price;
(b) where the retail sale price, declared on the package of any excisable goods at the time of its clearance from the place of manufacture, is altered to increase the retail sale price, such altered retail sale price shall be deemed to be the retail sale price;
(c) where different retail sale prices are declared on different packages for the sale of any excisable goods in packaged form in different areas, each such retail sale price shall be the retail sale price for the purposes of valuation of the excisable goods intended to be sold in the area to which the retail sale price relates.‖ 4 C/51671/2019
3. It is undisputed that the set top boxes imported by the appellant were covered by the notification and were chargeable to central excise duty on the basis of retail sale price read with the abatement as applicable under the notification. The Standard Weights and Measures (Packaged Commodities) Rules, 1977 2 covered set top boxes.
4. It is also undisputed that if the SWM Rules do not apply to any goods then Section 4A will also not apply to such goods and valuation has been done as per Section 4 of the Central Excise Act.
In this case, the appellant imported the set top boxes and claimed valuation under Section 4A in its Bills of Entry declaring retail sale price of Rs. 1000/- per piece. The assessing officer found that this price was too low and did not cover even the basic cost of goods plus the basic cost of customs duty. Therefore, he reckoned the retail price of Rs. 1,832/- per piece by adding the landed cost of the goods, the basic customs duty and 20% addition towards the post importation expenses. Reckoning Rs. 1,832/- as the RSP and after giving an abatement of 20% as per the notification, the officer charged duty on Rs. 1,465/- per piece. The appellant agreed to this re-valuation and paid duty accordingly.
5. In addition to the basic customs and additional duty of customs the appellant also paid special additional duty 3 @ 4% which is refundable if the appellant sells the imported goods after paying the appropriate amount of VAT to the State Government. The appellant applied for refund of SAD producing invoices under 2 SWM Rules 3 SAD 5 C/51671/2019 which it had sold the set top boxes to M/s Dish TV. On examination, it was found that the appellant had sold them at Rs. 2,100/- per piece as opposed to Rs.1,000/- per piece declared and Rs. 1,465/- per piece on which duty was paid. A show cause notice was issued to the appellant demanding differential duty of customs reckoning Rs. 2,100/- as the RSP because it was the price at which the appellant sold to M/s Dish TV. The appellant contested the SCN but the demand was confirmed and on appeal before this Tribunal, the matter was remanded to the original authority by Final Order No. 53423 of 2017 in Customs Appeal No. 640 of 2011. Paragraphs 5, 6 and 7 of which are reproduced below:
―5. We have heard both the sides and perused appeal records. The basic facts of the case are not disputed. The appellants imported the impugned items with a declared MRP printed at Rs. 1,000/- per piece. They have sold the said items to M/s. Dish T.V. India Ltd. for Rs.2,100/- per piece. We note, the said sale price is more than double, even though the transaction is in bulk, for 10,000 pieces. Further, M/s.Dish T.V. sold the impugned goods to the distributors at Rs.741/- per piece who further sold it to sub-distributor at Rs.761/- per piece. We note, there is evidence on record that the ultimate retail consumer purchased the set top box at Rs.961/- per piece. We note that the chain of transaction starting from import up to consumption by the retail buyer is having price variations of wide range, which cannot be explained by a linear business sale transaction. Admittedly, the sale price is not the sole consideration in respect of impugned goods from the stage of the first buyer, namely M/s. Dish T.V. India Ltd. who purchased these items at Rs.2,100/- per piece. In such a scenario, which is apparently unique, we find that the RSP printed and declared on the imported items is prima-facie having problem of genuineness. It is apparent that the importer and the first buyer are part of group companies. The sale price of M/s. Dish T.V. India to the distributor is only 1/3 of purchase price. Whatever may be the reasons for said transaction at 1/3 sale price, the undeniable fact is other considerations are in operation in the same transaction. Such transaction is certainly connected to other incomes, which are linked to the sale of the impugned goods.
6. On perusal of the impugned order, we find that the examination of legal provisions especially the provisions of Section 4 A and the scope of RSP as defined in the said Section as well as the application of the provisions of the Standards of Weighs and Measures (PC) Rules, 1977 have not been done in detail. More specifically for application of the facts of the present case. While the rejection of RSP declared by the appellant is prima-facie supported by the evidences as recorded by the ld. Authority to arrive at the correct RSP, the reasoning has to be recorded. While 6 C/51671/2019 the declared price is rejected, fixing the correct value is to be done with clear reasons and supporting evidence. In this, it is apparent that the appellants have to provide their side on the defence with supporting evidence as the MRP declared on the import package is, prima-facie, found to be not acceptable. However, the correct assessable value in terms of Section 4 A has to be arrived at, afresh by the original authority. We note that the value of Rs.2,100/- per piece has been adopted by the original authority on the ground that the importer has sold the set top boxes at that price to M/s. Dish T.V. India Ltd. We note that the said transaction has to be examined with reference to the definition for retail sale to arrive at the RSP. Admittedly, the appellant sold in bulk and also M/s. Dish T.V. India Ltd. cannot be considered as the retail consumer of the said set top boxes. This aspect requires reconsideration by the original authority.
7. In view of the above discussion and analysis, we find that the impugned order as it stands, cannot be sustained. The matter requires re-consideration and accordingly, the appeal is allowed and matter is remanded back to the original authority for a fresh consideration. The appellant shall be given adequate opportunity to present their case before a decision is taken.‖
6. On remand, the Commissioner passed the impugned order aggrieved by which the present appeal is filed. The main issue which falls for consideration is if differential additional duty of customs can be demanded from the appellant reckoning Rs.
2,100/- as the RSP. The other related issues to be decided are the demand of interest and imposition of penalty under Section 112.
7. Learned counsel for the appellant contested the impugned order and the demand on two grounds. Firstly, it is his submission that although the appellant had declared them retail sale price and assessed the bill of entry under Section 4A, in respect of identical products, it was decided by this Tribunal in Bharti Telemedia Ltd. Vs. Commissioner of Customs (Import), Nhava Sheva4 that there is no retail sale in use of the set top box by ultimate consumers and, therefore, Section 4A will not apply and valuation had to be done as per Section 4 of the Central Excise Act. This decision of the Tribunal was accepted by Circular dated 11 March 2016 issued by the CBEC which reads as follows:
4 2016 (331) ELT 138 (Tri.-Mumbai) 7 C/51671/2019 ―After detailed analysis, Hon'ble Tribunal held that in the given circumstances CVD shall not be leviable on the basis of Retail Sale Price. In view of the above, it is clarified the judgment of Hon'ble Tribunal in case of M/s Bharti Telemedia Ltd. (supra), may be followed for assessment of CVD on imported STBs, where the circumstances are identical‖.
8. It is, therefore, the submission of the learned counsel for the appellant that since the set top boxes imported by the appellant are also not sold to the consumers, the ratio of M/s Bharti Telemedia Ltd. should apply read with the CBEC circular.
9. The second submission of learned counsel is that even if valuation is done under Section 4A, the price of Rs. 2,100/- at which the appellant had sold these set top boxes to M/s Dish TV cannot be considered as retail sale price because Dish TV is an institutional buyer. It had purchased the set top boxes at Rs. 2100/- from the appellant and provided them to the subscribers for Rs. 700/- to Rs. 900/- per STB on right to use basis. There was no transfer of property between the Dish TV and the subscribers. However, in case the subscriber negligently damages the set top box, Dish TV would sell the damaged set top boxes to the subscriber for an amount of Rs. 1081.50 on which Dish TV has been paying VAT. It is, therefore, his submission that the RSP is only available in those very few cases where set top boxes have been damaged by the subscribers and an amount has been collected towards the cost of set top box by Dish TV. He further clarified that although Dish TV was purchasing the set top boxes at Rs.2,100/- it was not usually selling them but was using them to render its service. Therefore, it is an institutional consumer and is not a retail consumer and the price at which the goods have been sold to an institutional consumer cannot be called as retail sale 8 C/51671/2019 price in terms of the SWM Rules. He also draws our attention of the Bench to the definition of retail dealer, retail package, retail sale and retail sale price in these rules which are reproduced below:
(p) "retail package" means the packages which are intended for retail sale to the ultimate consumer for the purpose of consumption of the commodity contained therein and includes the imported packages:
Provided that for the purposes of this clause, the expression "ultimate consumer" shall not include industrial or institutional consumers.
(q) ―retail sale‖ in relation to a commodity, means the sale, distribution or delivery of such commodity through retail sales agencies or other instrumentalities for consumption by an individual or group of individuals or any other consumer."
(r) retall sale price means the maximum price at which the commodity in packaged form may be sold to the ultimate consumer and where such price is mentioned on package, there shall be printed on the packages the words [Maximum or Maxi.
Retail price..............inclusive of all taxes or in the Form M.R.P. Rs............... inclusive of all taxes.‖
10. It is his submission that in terms of Rule 2A of SWM rules, the provisions of Chapter-II of the Rules including Rule 6 which mandates declaration of RSP would not apply to packaged commodities meant for industrial consumers or institutional consumers. As per the Explanation to Rule 2A, ―institutional consumers‖ means consumers who buy packaged commodities directly from the manufacturers/packers for service industry like transportation (including airways, railways) hotel or any other similar industry‖. According to the learned counsel Dish TV is providing direct to Home 5 television services and for use in providing this service, it was buying set top boxes. Therefore, Dish TV cannot be considered as a retail buyer and, therefore, the requirement of indicating RSP as per Rule 6 SWM Rules does not 5 DTH 9 C/51671/2019 apply to STBs sold to Dish TV. Consequently, Section 4A of the Central Excise Act cannot be resorted for assessing the additional duty of customs payable on its products in the case.
11. Learned counsel also submits that the appellant had specifically relied on the circular dated 11.03.2016 issued by the CBEC and the decision of the Tribunal in the case of Bharti Telemedia Ltd. These submissions were recorded by the Commissioner in the impugned order at paragraph 7.9 but he has not given any finding on this issue. It is the submission of the learned counsel that the circular of the CBEC is binding on the departmental officers and, therefore, assessment should have been done as per Section 4 and not as per Section 4A.
12. It is his further submission that this Tribunal had, while remanding the order, specifically examined the facts of the case and indicated that Rs. 2,100/- cannot be considered as RSP and, therefore, the Commissioner's finding that RSP must be Rs. 2,100/- is not correct and is contrary to the findings of the Tribunal, therefore, it must be set aside. He prays that the impugned order may be set aside and appeal may be allowed with consequential relief to the appellant.
13. Learned authorised representatives for the Revenue Shri Nagendra Yadav and Shri Rakesh Kumar strongly support the impugned order. On the first question of applicability of Bharti Telemedia Ltd. and CBEC Circular dated 11.03.2016 to this case, they fairly admit that the impugned order has not given any findings. However, they assert that the case of the Bharti 10 C/51671/2019 Telemedia was quite different inasmuch as in that case Bharti Telemedia had imported the goods and used them in providing service by itself. It had not sold the goods to somebody else. There is no sale price in that case except in those few cases where there was a damage to the set top boxes. The CBEC circular dated 11.03.2016 also specifically directed that the judgment of M/s Bharti Telemedia must be followed for assessment of excise duty or CVD on imported STB where the circumstances are identical. In this case the circumstances are not identical as the appellant had imported set top boxes and sold them to Dish TV and there was a sale price.
14. On the second question of whether Rs. 2,100/- can be considered as the retail sale price learned authorised representatives rely on the explanation to Rule 2A of the SWM Rules 1975 which defines ―institutional consumers‖ as those who buy packaged commodities directly from the manufacturer/packers for service industry. It is their submission that the importer is not the manufacturer or a packer of STBs and therefore, buying from an importer does not fall under this definition. Therefore, Dish TV cannot be considered as an institutional consumer. They also rely on the Rule 23(1) and (2) of such Rules which state that no retail dealer or any other person including manufacturer, packer and wholesale dealer shall make any sale of any commodity in packed form at price exceeding the retail sale price thereof. It is, therefore, their submission that once the goods have been sold at Rs. 2,100/- it cannot be said that this price is higher than the retail sale price and it must be considered as RSP. It is also evident that 11 C/51671/2019 there was no other sale of STBs and since the STBs are sold at this price, it should be considered as retail sale price. They further assert that Notification No. 49/2008-CE(NT) dated 24 December 2008 under which set top boxes have been notified for valuation under Rule 4A at S. No. 99 has an explanation which reads as follows:
"For the purposes of this notification, except S. No. 30,"retail sale price" means the maximum price at which the excisable goods in packaged form may be sold to the ultimate consumer and includes all taxes, local or otherwise, freight transport charges, commission payable to dealers and all charges towards advertisement, delivery, packing, forwarding and the like, as the case may be, and the price is the sole consideration for such sale'.
They further rely on Rule 5 of the Central Excise (Determination of Retail Sale Price of Excisable Goods) Rules, 2008 which reads as follows:
"5. Where a manufacturer alters or tampers the retail sale price declared on the package of goods after their removal from the place of manufacture, resulting into increase in the retail sale price, then such increased retail sale price shall be taken as the retail sale price of all goods removed during a period of one month before and after the date of removal of such goods :
Provided that where the manufacturer alters or tampers the declared retail sale price resulting into more than one retail sale price available on such goods, then, the highest of such retail sale price shall be taken as the retail sale price of all such goods."
15. It is therefore, the submission that the RSP declared by the appellant was altered because the actual price at which STBs have been sold was Rs. 2,100/- whereas the appellant declared only Rs. 1,000/- which was enhanced by the officers to 1835/-. Therefore, the notification read with Central Excise (Determination of RSP) Rules, 2008 makes it abundantly clear that Rs. 2,100/- can be taken as the retail sale price. For these reasons, they pray that the impugned order may be upheld and the appeal may be rejected. Their further submission is that the assessment under Section 4A 12 C/51671/2019 was done by the appellant themselves and, the appellant cannot now claim an assessment under Section 4 because the assessment under Section 4A has not been assailed by the appellant by filing an appeal before Commissioner (Appeals).
16. We have considered the submissions on both sides and perused the records. There are only two questions before us. The first question is should the additional duty of customs be assessed as per Section 4 or Section 4A of the Central Excise Act and the second is if assessment is done under Section 4A if Rs. 2,100/- can be taken as RSP. It is not in dispute that set top boxes were notified under SWM rules and therefore, notification applies to the set top boxes which were imported. However, assessment under Section 4A applies only if the SWM Act read with the SWM Rules applies to the goods being assessed. Even if the goods are notified under Section 4A but the SWM Act and Rules requiring RSP to be declared do not apply, Section 4A will not apply. For instance, if the goods are notified but a particular manufacturer or importer does not sell the goods directly or indirectly to consumers but sells them to only industrial consumers or institutional consumers, then the SWM Rules do not apply and RSP does not have to be declared. Consequently, such manufacturer or importer will have to pay Central Excise duty or, as the case may be, additional duty of customs as per Section 4 of the Central Excise Act and not as per Section 4A. The SWM rules, make an exception to institutional consumers and the price at which the goods are sold to ―institutional consumers‖ cannot be considered as retail sale price. The institutional consumer in this case is the Dish TV. According to 13 C/51671/2019 the learned authorised representatives for the Revenue, Dish TV does not qualify as an institutional consumer because it had not purchased the goods from the manufacturer or packer but had purchased them from the importer. According to the learned counsel for the appellant Dish TV qualifies as an institutional consumer because it was buying the STBs for rendering its services. It is also his submission that although the importer is not a manufacturer, he stands on the same footing as the manufacturer because the SWM rules and Section 4A of the Central Excise Act which are essentially meant for manufacturing within the country have been made applicable to imports by virtue of Section 3 of the Customs Tariff Act. Therefore, the importers stand in the same footing as the manufacturer. It is also the contention of the learned counsel for the appellant that after the goods were imported the appellant sold after repacking them as per the requirement of Dish TV. For this reason also, he submits that the Dish TV qualifies as an institutional consumer.
17. We have considered these submissions. We do not agree that Dish TV can be considered as a retail consumer. It is an institutional consumer because it uses the STBs to provide service to the subscribers. Therefore, the bulk of STBs purchased by Dish TV cannot be considered as having a retail sale nor can the price of Rs.2,100/- be called Retail Sale Price. There can be retail price only if the STBs are sold to the ultimate consumer.
18. In this case since the goods are not sold to the consumer there cannot be a retail sale price. The price at which goods are sold in wholesale or to an industrial or institutional consumer 14 C/51671/2019 cannot be retail sale price as per the SWM Rules. Retail sale price is available only in those few cases where set top boxes have been damaged and subsequently sold to the subscriber. Undisputedly, the set top boxes were sold were much lower prices than Rs. 2,100/- in respect of such retail sales. In our considered view, the price at which the goods were sold to Dish TV cannot be considered as retail sale price.
19. Further, we find that in the case of Bharti Ltd. set top boxes were imported and used to provide service to the customers and it was held that they are not covered under Section 4A for the reason that there was no sale to the subscribers. The present case is identical except that the appellant themselves were not providing the service but were selling the STBs to M/s Dish TV which was providing the service. In our considered view, Dish TV cannot be considered as retail buyer because it is not using the goods for itself but is using them to provide service to its subscribers. Therefore, the price of Rs. 2,100/- at which the goods were sold to Dish TV cannot be considered as retail sale price even if the assessment is not modified and continues to be under Section 4A as was done in this case. The assessment should correctly be done under Section 4 as per Bharti Telemedia. Assessment in this case was done under Section 4A as per RSP with abatement as decided by the assessing officer of Rs. 1465/-. We find that the assessing officer has rejected declared RSP of Rs. 1000/- per set top box and recalculated it after adding the basic customs duty to the landed cost of the STB and adding 20% as post importation 15 C/51671/2019 cost which came to Rs. 1832/-. After allowing 20% abatement, he determined the additional duty of Customs on a value of Rs. 1465/-
20. If Section 4 is applied duty has to be determined on the landed cost of the goods plus basic customs duty which will also be Rs. 1465/- per STB. Therefore, there will be no difference between the value on which additional duty was determined by the assessing officer under Section 4A and the value on which it will have to be determined if Section 4 is applied.
21. As far as the applicability of the Bharti Telemedia is concerned, there is no finding in the impugned order as to why the Bharti Telemedia does not apply to the present case. Learned authorised representatives for the Revenue submit that it does not apply because Bharti Telemedia did not sell set top boxes whereas appellant sold them to Dish TV, which, in turn, used them to providing service. While it is true that in Bharti Telemedia, there was no sale at all and hence there was no Retail Sale Price, in this case there are no retail sales but only sale to Dish TV. Dish TV, in turn, did not sell the STB to individual consumers (subscribers) except where the subscriber damaged the STB in which case it sold them for Rs. 1,081.50 per STB. In all other cases, the subscribers paid only Rs. 700/- to Rs. 800/- for right to use. The amount of Rs. 700/- to Rs. 800/- paid for right to use cannot be considered as Retail Sale Price because there was no transfer of property. The sale price of Rs. 1,081.50 paid by subscribers is the Retail Sale Price but it does not reflect the bulk of the STBs which are imported.
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22. The question which arises is how can the retail sale price be lower than the institutional sale price of Rs. 2,100/-. This apparent anomaly is because Dish TV is not in the business of selling STBs but is in the business of providing DTH services for which purpose it uses the STBs. The main Revenue stream of its business is the subscriptions to channels and monthly rentals and it is not the sale of STBs. In fact, it owns all the STBs and only collects some amount (Rs. 700 to Rs. 800) which is only one third of the price it paid from the subscribers for right to use.
23. Learned authorised representatives laid great emphasis on Rule 23(2) of the SWM Rules which reads as follows:
―No retail dealer or other person including manufacturer, packer and wholesale dealer shall make any sale of any commodity in packed form at a price exceeding the retail sale price thereof.
Explanation : for the removal of doubts, it is hereby declared that a sale, distribution or delivery by a wholesale dealer to a retail dealer or other person is a ―retail sale‖ within the meaning of this sub-rule.‖ It is submitted that since nobody (not just the retailer) can sell any goods at a price above RSP, and since the appellant sold the Dish TV at Rs. 2,100/- this amount cannot be said to be higher than the RSP. Therefore, RSP should be taken as Rs. 2,100/-. Learned authorised representatives also argued that once the appellant themselves have self assessed additional duty under Section 4A, it is not open for them to question the applicability of Section 4A. We have already discussed and found that there is no retail sales but only institutional sales in this case and we find nothing in Rule 23(2) that permits sale price to institutional buyers to be reckoned as retail sale price. It is true that assessment (both self assessment and re-assessment) were done under Section 4A and 17 C/51671/2019 the appellant had not assailed the assessment. However, by issuing the SCN Revenue has re-opened the assessment on one ground (that RSP should be taken as Rs.2,100/-) and it is open to the appellant to plead any grounds in defence including any question of law (that Section 4 and not Section 4A should have been applied) and it is for the adjudicating authority and appellate authorities to consider the defence. We have considered this question found in favour of the appellant.
24. In view of the above, the appeal is allowed and the impugned order is set aside with consequential relief to the appellant.
(Dictated & pronounced in open Court) (P. V. SUBBA RAO) MEMBER(TECHNICAL) (BINU TAMTA) MEMBER(JUDICIAL) RM