Custom, Excise & Service Tax Tribunal
Fourrts India Laboratories P Ltd vs Chennai-Iii on 24 April, 2024
CUSTOMS, EXCISE AND SERVICE TAX APPELLATE
TRIBUNAL, CHENNAI
REGIONAL BENCH - COURT No.III
Excise Appeal No.40463 of 2015
(Arising out of Order-in-Appeal No.76/2014 (M-III) dated 06.05.2014 passed by
Commissioner of Central Excise (Appeals-), No.26/1, Mahatma Gandhi Marg,
Nungambakkam, Chennai 600 034)
M/s.Fourrts (India) Laboratories P Ltd .... Appellant
Vandalur Kelambakkam Road,
Kelambakkam 603 103.
VERSUS
The Commissioner of GST & Central Excise ...Respondent
Chennai Outer Commissionerate
Newry Towers, No.2054, I Block, II Avenue,
12th Main Road, Anna Nagar,
Chennai 600 040.
APPEARANCE:
Shri Mira Aurobindo Cumar, Advocate, for the Appellant
Shri Harendra Singh Pal, Authorised Representative, for the Respondent
CORAM:
HON'BLE MS. SULEKHA BEEVI.C.S, MEMBER (JUDICIAL)
HON'BLE MR. VASA SESHAGIRI RAO, MEMBER (TECHNICAL)
FINAL ORDER No.40454/2024
DATE OF HEARING : 16.04.2024
DATE OF DECISION : 24.04.2024
ORDER:[Per Ms. Sulekha Beevi. C.S.] Brief facts are that the appellant are engaged in the manufacture of P and P medicaments and registered with the Central Excise department. On perusal of records of the appellant, it was found that they have cleared 2 Excise Appeal No.40463 of 2015 their final products both for sales (affixing MRP) as well as for free distribution to physicians, as samples (not affixing MRP).
2. During the period January 2011 to March 2011, for regular sales, the appellant had adopted valuation under Section 4A of the Central Excise Act, 1944. Whereas, for clearance of physicians samples, the appellant had adopted the 'transaction value' under Section 4 for payment of Central Excise duty. For the period prior to May 2008, the appellant had done valuation of physician samples under Section 4A of Central Excise Act, 1944.
3. It appeared to the department that in respect of physician samples also, the value should be determined under Section 4A and not under Section 4, as adopted by the appellant. Show Cause Notice was issued proposing the demand of duty under Section 4A for the physician samples cleared by the appellant during the period January 2011 to March 2011. After due process of law, the Original Authority confirmed the demand of Rs.2,65,965/- along with interest and imposed equal penalty. On appeal, the Commissioner (Appeals) upheld the order. Hence this appeal.
4. The Learned Counsel, Shri Mira Aurobindo Cumar, appeared and argued for the appellant. It is submitted that the issue is whether the physician samples cleared for distribution by the appellant has to be assessed under Section 4A or under Section 4 of Central Excise Act, 1944. The issue is no longer res integra. For the previous period the Tribunal vide Final Order nos.40706, 40707/2023 dated 21.08.2023, has held that in the case of clearance of physician samples, the value has to be determined on the 'transaction value' and not under section 4A of the Central Excise Act, 1944, as it is not intended for retail sale.
5. The Learned AR, Shri Harendra Singh Pal, Assistant Commissioner appeared and reiterated the findings in the impugned order. 3
Excise Appeal No.40463 of 2015
6. Heard both sides.
7. The issue to be decided is whether the physician samples (P & P medicaments) are to be assessed under Section 4 or 4A of Central Excise Act, 1944. The Tribunal, for the earlier period in the appellant's own case had considered the same issue. The decision of the Hon'ble Apex court in the case of Sun Pharmaceuticals Limited [2015 (326) ELT 3 (S.C.)] was followed by the Tribunal and it was held that the valuation has to be determined under Section 4 and not under Section 4A. The demand confirmed on the basis of determination of value under Section 4A is not legal and proper.
9. Following the Tribunal's earlier decision, we are of the considered view that the demand cannot sustain. The impugned order is set aside. The appeal is allowed with consequential reliefs, if any.
(Order pronounced in the open court on 24.04.2024) sd/- sd/-
(VASA SESHAGIRI RAO) (SULEKHA BEEVI. C.S)
Member (Technical) Member (Judicial)
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