Customs, Excise and Gold Tribunal - Mumbai
Raptakos Brett And Co. Ltd. vs Cce on 3 March, 1999
Equivalent citations: 1999(83)ECR68(TRI.-MUMBAI)
ORDER S.S. Kang, Member (J)
1. The appellants filed this appeal against the order-in-appeal dated 7.12.1987 passed by the Collector of Central Excise (Appeals). In the impugned order the Collector (Appeals) of Central Excise denied the benefit of notification No. 161/66-CE dated 8.10.1966 (as amended) to the appellants.
2. Brief facts of the case are that the appellants are engaged in the manufacture of P & P Medicaments, and they filed the price list and claimed the benefit of Notification No. 161/66-CE. The price list was approved by the Assistant Commissioner of Central Excise. Thereafter, a show cause notice was issued on 16.11.1983 for the period April to June, 1983 alleging that the appellants were not entitled for the benefit of Notification No. 161/66-CE. The adjudicating authority dropped the proceedings. On appeal the Collector (Appeals) denied the benefit of the said notification.
3. Learned Counsel for appellants submits that the Notification No. 161/66-CE provides a discount of 25% on the price specified in the price list showing the retail price referred in the Drug Price (Control) Order, 1979. He submits that para 19 of the Drugs Price (Control) Order, 1979 provides that every manufacturer or importer of formulation entitled for sale shall furnish to the dealer and to the State Drug Controller a price list showing the price at which the formulation is to be sold to retailer and the retail price. He, further, prays that the appellants are entitled for the benefit of Notification No. 161/66-CE in view of para 19 of the Drugs Price (Control) Order.
4. Shri H.K. Jain, learned D.R. appearing for the respondents submits that the Drugs Price (Control) Order only provides 3 categories and the Drugs Price (Control) Order relates to only these categories and not to other categories. He submits that the Drugs in question was not covered under any 3 categories mentioned in the Schedule to the Drugs Price (Control) Order. He also reiterate the findings of the impugned order.
5. Heard both sides. In this case the only short point involved is whether the appellants are entitled for the benefit of Notification No. 161/66 dated 8.10.1966. This Notification provides a discount of 25% on the price specified in the price list showing the retail price as required under para 19 of the Drugs Price (Control) Order, 1979. The benefit of the Notification was denied only on the ground that the Drugs in question were not covered under any category mentioned in the Schedule to Drugs Price (Control) Order, 1979.
6. We find that para 18 of Drugs Price (Control) Order provides that "the provisions of this order, other than those in para 10 to 14 (both inclusive), shall apply to any formulation not specified in category I, II or category III of the third Schedule". Admittedly, the drugs in question are not covered in any category of the 3rd Schedule. Further, the paragraph 19 of the Drugs Price (Control) Order reads as under:
19. Furnishing of price list by manufacturer or importer to dealers.
(1) Every manufacturer or importer of a formulation intended for the sale shall furnish to the dealers, State Drug Controllers and the Government, a price list showing the price at which the formulation is sold to a retailer (inclusive of excise duty) and the retail price of such formulation and the list shall be furnished to the dealers, in Form 5, not later than thirty days from the commencement of this order.
The reading of para 19 of Drugs Price (Control) Order provides that every manufacturer or importer of a formulation has to furnish to the State Drug Controller a price list showing the price at which the formulation is sold to a retailer and showing the retail price.
7. The Notification No. 161/66-CE provides the exemption to P or P medicaments falling under item 14E of the First Schedule to the Central Excise and Salt Act from so much of duty of the excise leviable thereon as is in excess of the duty calculated on the basis of the value arrived at after allowing a discount of 25% on the price specified in the price list showing the retail prices referred to in paragraph 19 of Drugs Price (Control) Order. In view of this situation we do not agree with the findings of the learned Collector (Appeals) in the impugned order that the Drug in question is not covered under any category under the Schedule to the Drugs Price (Control) Order. In view of the fact that the Notification covers the price list as mentioned in para 19 of the Drugs Price (Control) Order we set aside the impugned order and appeal is allowed.
(Dictated and pronounced in the open court.) Sd/- Separate Order Sd/- (S.S. Kang) (S.K. Bhatnagar) (V.K. Agrawal) Member (J) President Member (T) S.K. Bhatnagar, President
8. I would only like to add and clarify that para 14(1) and (2) and para 15(A) & (B) of the DPCO, 1979 are required to be read along with para 18 & 19. These paras read as follows:
14. General provisions regarding prices of formulations.--(1) No manufacturer or importer shall market a new formulation or a new pack, or a new dosage form of his existing formulation specified in Category I or Category II or Category III of the Third Schedule without obtaining the prior approval of its price from the Government.
(2) No person shall sell or dispose of any imported formulations specified in Category I or Category II or Category HI of the Third Schedule without obtaining the prior approval of its price from the Government.
15. Power to revise prices of formulations.-Notwithstanding anything contained in this Order-
(a) the Government may after obtaining such information as it may consider necessary from a manufacturer or an importer, fix or revise the retail price of one or more formulations marketed by such manufacturer or importer, including a formulation not specified in any of the categories of the Third Schedule, in such manner as the pre-tax return on the sales turnover of such manufacturer or importer does not exceed the maximum pre-tax return specified in the Fifth Schedule.
(b) the Government may, if it considers necessary so to do in public interest, by order, revise the retail price of any formulation specified in any of the categories of the Third Schedule.
9. It would be seen that when read in the context of Para 14 and 15 the correct meaning and intention of para 18 and 19 becomes clear. Read together these four para shows that formulations included in categories I, II or III require prior approval of the price from the Government (i.e. before their sale or disposal) and the Government has the authority to fix the price or reserve its right to revise the retail price but even in the case of formulations not included in the above schedules certain provisions of this order (i.e. other than those contained in paras 10 to 14) applied and the manufacturer are required to furnish a price list. Therefore, it cannot be said that these are not covered by DPCO order. Hence, impugned order is required to be set aside as already announced in the Open Court.