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2. After hearing both sides, duly represented by Shri N.Viswanathan, and Shri G.Natarajan, Advocates for the appellants and Shri P. Arul, DR for the Revenue, we find that the appellants are engaged in the manufacture of medicaments, which are specified items under Section 4A of the Central Excise Act, 1944 requiring payment of duty on the basis of M.R.P printed on them. Apart from the regular medicaments, the appellants are also manufacturing physician samples. In some of the cases, such physician samples are being manufactured by the appellants on their own count and cleared for free distribution. In some cases, the samples are being manufactured by the appellants on behalf of other medicament manufacturing units, on job work basis. Such samples manufactured on job work basis are being cleared on payment of duty at the contracted price between the job worker and the principal manufacturer. The dispute in the present appeals relate to the valuation of such physician samples.

3. As we find that there are two types of physician samples, one manufactured under contract on job work basis and the other manufactured and cleared as free samples, both the issues are required to be addressed separately.

4. As regards the physician samples manufactured on job work basis, on behalf of the brand name owners, we find that such samples are being cleared by the appellants on payment of Central Excise duty in terms of the provisions of Section 4 of the Central Excise Act. The appellants contention is that they are not clearing the physician samples for free distribution but the same are sold to the other companies at an agreed price as per the purchase order placed upon them. Such price mentioned in the purchase order is the sole consideration for sale and the transactions are on principal to principal basis. As such, the assessable value of the physician samples is to be arrived at on the basis of such transaction values.

5. We find that there are various decisions of the Tribunal accepting the above stand of the appellants. In the case of Themis Laboratories Pvt. Ltd. and Meghdoot Chemicals Ltd. Vs CCE Mumbai  2011-TIOL-1189-CESTAT-MUM, the Tribunal held, by following the decision in the case of Mayer Health Care Pvt. Ltd. Vs CCE Bangalore  2008-TIOL-2494-CESTAT-BANG that where physician samples are not distributed free of cost by the manufacturer, but are cleared on receipt of consideration, the excise duty is required to be paid on the transaction value. To the same effect is another decision of the Tribunal in the case of Omni Protech Drugs Pvt. Ltd. Vs CCE Pune - 2011 (274) ELT 377 (Tri-Mumbai) laying down that transaction value is to be taken as the assessable value when physician samples cleared to the brand owner on transaction values. Another decision of the Tribunal in the case of Softesule Pvt. Ltd. Vs CCE Mumbai  2011-TIOL-1439-CESTAT-MUM is to the effect that when physician samples manufactured and cleared to brand owners/ buyers on principal to principal basis for a consideration, which are further distributed by the buyer free of cost to physicians/doctors, the same is required to be assessed to duty on the transaction values. The Tribunals decision in the case of CC Vs Sidmak Laboratories (India) Ltd. - 2009 (242) ELT 255 (Tri.-Ahmd.) also affirms the above view. Revenues appeal against the said order of the Tribunal was dismissed by the Honble Supreme Court as reported in 2011 (270) ELT A90 (SC).

Inasmuch as the issue is no longer res integra and stands decided by various decisions of the Tribunal, we hold that wherever the appellants manufactured physician samples under a contract with the brand owner and have cleared the same by adopting the said transaction value, no further demand of duty is required to be confirmed against them.

6. As regards the physician samples manufactured by some of the appellants on their own behalf and distributed free of cost, we find that the issue is no more open for arguments inasmuch as the Larger Bench of the Tribunal in the case of Cadila Pharmaceuticals Ltd. Vs CCE Ahmedabad - 2008 (232) ELT 245 has held that valuation of such physician samples is required to be made on the basis of pro rata value of the regular pack of the comparable goods in terms of the provisions of Rule 4. Ld. Advocate appearing for the appellants has sought to argue that the Larger Bench decision of the Tribunal stands impliedly overruled by a subsequent decision of the Honble Supreme Court in the case of CCE Bangalore Vs Bal Pharma Ltd. - 2010 (259) ELT 10 (SC), when the Honble apex court refused to entertain the appeal filed by the Revenue.