Customs, Excise and Gold Tribunal - Delhi
H.P. Horticultural Produce M. And P. ... vs C.C.E. on 11 February, 1998
Equivalent citations: 1998(60)ECC176, 1998ECR323(TRI.-DELHI), 1998(103)ELT160(TRI-DEL)
ORDER
U.L. Bhat, President
1. Learned Counsel for the appellant has sent a request for adjournment on the ground that she is out of station for personal reasons. We consider that this ground for adjournment is not adequate. We reject this request. We have heard Shri K. Srivastava, SDR and perused the papers.
2. Appellant engaged in the manufacture of fruit juice was clearing the same on payment of duty on approved price treating the fruit juice as falling under erstwhile T.I. IB. The balance sheet and other records showed that during the period from 1-4-1982 to 31-3-1985, the appellant had realised certain amount as "service charge" besides the approved price without disclosing the same to the department. Show cause notice dated 7-11-1987 was issued proposing demand of differential duty on "Service Charge" collected invoking the extended period of limitation under the proviso to Section 11A of C.E.T. Act, 1944. Though the appellant resisted the notice, the Additional Collector confirmed the demand.
3. The dealers who purchase fruit juice from the appellant set up outlets at public places such as railway station and airport etc. and dispensed fruit juice in plastic cups to consumers. Supply to the dealers is made in carbouys according to the requirement of the dealers. There was no stipulated quantity of fruit juice on each carbouys. Appellant was making available to the dealers equipment for dispensing to the consumers and was charging rental or hiring charges. Demand in this case was as rental charges termed as "service charges" in the show-cause notice.
4. In the case of present appellant reported in 1988 (38) E.L.T. 160 (T), the Tribunal held that in case of clearance on sale of varying quantities in big plastic carbouys, the container cannot be called as 'unit containers' within the meaning of T.I. IB as the carbouys do not contain limitation quantity and therefore, the product falls under erstwhile T.I. 68. Notification No. 55/75 fully exempted food products falling under T.I. 68 from payment of excise duty. In this view, the product itself being exempt, the question of paying duty on hiring charges on dispensers does not arise.
5. Even if it is be that the product attracted the erstwhile T.I. IB, we are of the view that rent for the dispensers cannot become part of the assessable value of fruit juice. Fruit juice is sold in carbouys to dealers. Dealers [sent] fruit juice to consumers in small quantity in plastic cups for which purpose, dispenser is necessary. It is for the dealer to arrange for dispensers for themselves either by purchasing such equipment or by taking such equipment on hire from the manufacturer or in other; this cannot have anything to do with the activity of manufacturer of fruit juice. It cannot be regarded as enhancing marketability of bulk fruit juice in carbouys sold by the manufacturer. Even if the product dutiable, hire charges collected cannot be regarded as part of the assessable value. For the reasons indicated, we set aside the impugned order and allow the appeal.