Customs, Excise and Gold Tribunal - Delhi
Narmada Drinks (P) Ltd., Shri Naresh ... vs C.C.E. on 15 April, 2004
Equivalent citations: 2004(96)ECC262, 2004(170)ELT85(TRI-DEL)
ORDER C.N.B. Nair, Member (T)
1. All these appeals are directed against a common order of adjudication. Therefore, they were heard together and are disposed of under this common order.
2. The dispute relates to central excise valuation of aerated drinks, Thums Up/Coca Cola manufactured by M/s Narmada Drinks (P) Ltd.. The goods were under provisional assessment from 1.4.94. Under the impugned order, higher assessable value has been fixed from 1.4.94 to August 1997 and differential duty of over Rs. 12 lakhs demanded Penalties have also been imposed on the appellants
3. Assessable value has been fixed after rejecting the appellant manufacturer's sale price to their distributors on account of their being dummies and working out fresh assessable value by allowing certain deductions from the invoice price of the dealers. The dealers in question are M/s Bilaspur Agency for the period 1.4.94 to 20.10.94 and M/s Chattisgarh Agency for the subsequent period. It is the finding that these distributors were dummies because proprietor was an ex-employee of M/s Narmada Drinks (P) Ltd., they have no major financial or other capabilities and had ceased to exist by the time investigation started. The Commissioner has recorded very detailed reasons for holding that the dealership was a sham.
4. The appellants have contended that, apart from the fact that distributors were genuine, the other relevant facts also would show that findings are without any basis. The main contention of the appellants is that though the distributors were described as sole distributors, there were other independent buyers also for the goods and the price to those buyers was the same as the price to distributors. Another factor being pointed out is that if Commissioner had allowed deduction of all permissible post manufacturing expenses, he would have found the assessable value adopted for original assessments to be reasonable and correct.
5. It has also been pointed out that a mere comparison of the appellant's sale price with competing brands would have shown that the appellant's sale price was a fully commercial price. Reference in this connection has been made to the appellant's sale price of Rs. 37.50 per crate as against the sale price of Rs. 28/- for Dukes and Rs. 32 for Pepsi. The appellants have also produced particulars of sale tax assessments of M/s Chattisgarh Agency for the period 1995-96 and 1996-97. They have also produced banking details of M/s Bilaspur Agency and Chattisgarh Agency, and registration under shop and establishment laws. During the hearing, learned Counsel for the appellant emphasised that all these documents had bee verified by the superintendent of Central Excise at Bilaspur and found to be correct.
6 We have perused the records and considered the submissions made by both sides. The sale data produced by the appellants shows that they had several buyers other than their so-called sole distributors. The invoice analysis for the month of August 1995 show that sale to the sole distributors was only 19% and sale to many other parties like M/s Vishwaraj Enterprises, Bilapur, Nagpur Soft Drinks Distributors Pvt. Ltd., Durga Agency and others worked out to the remaining 81%. Similarly, in September 1995, sales to Chattisgarh Agency was only 3% and the rest of the sale was to other parties. Sales data for many other months also show the same position. The banking transaction of Bilaspur agency and Chattisgarh Agency also brings out that these partice were having regular high value transactions with the bank. The sale tax return also shows that M/s Chattisgarh Agency had a transaction of over Rs. 1 crore in 1995-96 Rs. 19.4 lakhs in 1996-97.
7. It is well settled that if normal price is available on ex-factory basis, that price is to constitute the assessable value for all the goods produced and removed by a manufacturer. In the present case, the issue as to whether sale to sole distributors was vitiated or not would appear to be irrelevant for the determination of the assessable value of the goods, in as much as there were sales to many independent buyers also at the same price. Commercial nature of those prices is also borne out by the fact that the assessable value claimed by the appellant was above the assessable value being adopted for competing products like Pepsi.
8. In the light of what is stated above, we are of the opinion that the finding of short-levy of duty is not justified. The duty demand and penalties flowing from that finding cannot be upheld. Accordingly, the impugned order is set aside and the appeals are allowed with consequential relief to the appellants.