ORDER
Lajja Ram, Member (T)
1. This is an appeal filed by M/s. National Rayon Corporation Limited being aggrieved with the Order-in-Appeal dated 21-1-1987 of the Collector of Central Excise (Appeals), Bombay wherein he had held that the charges separately collected from the buyers in the name of washing the tanker are a part of the value of Caustic Soda Lye.
2. Shri G. Shivadass, Advocate for the party stated that they are engaged in the manufacture of Caustic Soda Lye. Their buyers arrange for the tankers which are durable packing and whose cost is not includible in the assessable value of the excisable goods. The price agreed for the sale of the goods is paid by their customers. In some cases, the tankers, arranged by their customers are cleaned before the goods filled in them. For this activity of cleaning of the tankers before filling the goods, they are charging a fixed amount of Rs. 25/- per M.T. The Department had added these sums in the assessable value which in fact means that there would be two assessable values for the same goods, one where no cleaning is required and the other where cleaning of the tanks is done before filling. He referred to the Hon’ble Supreme Court’s decision in the case of Collector of Central Excise v. Indian Oxygen Ltd. – 1988 (36) E.L.T. 730 (SC).
3. In reply, the ld. JDR stated that the findings of the Asstt. Collector are that this amount was uniformly charged in all cases and that there was no evidence as in how many cases these separate charges were not collected from the customers. He referred to the Order-in-Appeal and the findings of the ld. Collector (Appeals), Central Excise and submitted that filling was done within the factory premises and that cleaning was a process of filling and not of the transport of the goods.
4. We have carefully considered the matter. Under Section 4(4)(d)(i) value in relation to any excisable goods where the goods are delivered at the time of removal in a packed condition, includes the cost of such packing except the cost of the packing which is of a durable nature and is returnable by the buyers to the assessee. It has been explained that packing means wrapper, container, bobbile, pirn, spool, reel or any other in which or on which the excisable goods are wrapped, contained or filled.
It is clear that the word “packing,” refers to the containers in which the excisable goods are packed. Even when the packing is of a durable nature, the cost of process of packing as such has to be included in the assessable value. In other words, while the cost of the durable packing itself will be excludible, the cost incurred towards packing the excisable goods in such durable container will be included.
5. In this case, there is no dispute that separate charges were collected for washing the containers in which the excisable goods were to be filled-in. This activity of washing was undertaken within the factory premises before the goods manufactured placed in the tankers. The Collector (Appeals), Central Excise, had observed that “since these charges are incurred before the goods are filled-in and therefore become a part of the value of the goods.” He referred to the Hon’ble Supreme Court’s Judgment in the case of Bombay Tyre International- 1983 (14) E.L.T. 1896 (SC).
6. The ld. Advocate had contended that the tankers were washed only where such washing was required and that the washing was not done in all the cases. We find that the Asstt. Collector, who had adjudicated the matter, had observed that these charges were collected from all the customers. The Collector (Appeals) has also referred thata sum of Rs. 25/- per M.T. was being charged uniformly. There is nothing on record to show as in how many cases these charges were not collected even when the tankers were arranged by the purchasers.
7. In the case of Vijaywada Bottling Co. Ltd. v. Collector of Central Excise -1993 (63) E.L.T. 526 (Tribunal), the Tribunal in Para 23.2 of the order with regard to P. P. foods had held that any process undertaken in respect of glass bottles i.e. sorting out brandwise, separating the defective bottles from the non-defective bottles, cleaning etc., becomes a part of the process of manufacture of the ‘P’or ‘P’ food. These activities could not be taken as not related to the manufacturing activities of the excisable goods. Reference may also be made to the Tribunal’s further decision in the case of some appellant, Vijaywada Bottling Co. Ltd. v. CCE as reported in 1993 (68) E.L.T. 104 (Tribunal).
8. The ld. Advocate had referred to the Hon’ble Supreme Court’s decision in the case of Indian Oxygen Ltd. The issue before the Hon’ble Supreme Court in that case related to maintenance of the cylinders in which the gas was filled-in. The question of filling of the gas in the cylinders as such was not a issue before the Apex Court. The Hon’ble Supreme Court had ruled that the expenditure collected by the assessee on any ancillary activities would not form part of the assessable value of the gases. In the instant case, the position is different. The tankers were arranged by the purchasers and there was no question of any maintenance by the appellants / manufacturers.
9. Taking all the relevant considerations into account, we do not find any infirmity in the order passed by the Collector (Appeals), Central Excise. As a result, the appeal is rejected. Ordered accordingly.