ORDER
S.S. Sekhon, Member (T)
1. This rectification of mistake application (hereinafter referred to as ROM) has been filed under Section 35C(2) of the Central Excise Act, 1944, by Revenue, against the Final Order No. 1167/2001, dated 22-6-2001, of this Bench, allowing the appeal filed by the assessee. This order was passed placing reliance on Supreme Court judgment in the case of Hindustan Polymers reported in 1989 (43) E.L.T. 165 and held that the value of drums supplied by the buyers would not be loaded to the value of the liquid glucose delivered unpacked in loose form in such drums.
2. We have heard both sides and gone through the documents.
(a) Revenue has contended that the manufacturer in this case was having another factory in Gujarat, manufacturing similar products and as per Rule 173C(1) second proviso Clause 5. They were required to declare the value under Section 4 for the purposes of approval. They had filed such declarations in the Annexure III form but have cleared liquid glucose at prices lower than those declared. Since they were bound by Rule 173C(1) proviso, they were required to file amended declarations in terms of the reduced prices. No such amendments were filed. The contention of the assessee that the sale were on contract prices would not be relevant since, the class of buyers were the same for identical goods. In these terms the decision of Hindustan Polymers was not fully applicable in this case.
(b) The Id. Advocate Shri Nair appearing for the respondent manufacturer submits, that there is no mistake in the order. In any case the price list approval were governed by C.B.E. & C. Circular No. 34/85, dated 31-10-85, wherein the request of the Trade has been examined by the Board and it has been decided that where ‘oral contract’ has been entered into between the assessee and his buyer, the same should be accepted. He also relied upon the instruction in the CBR bulletin, 1976, wherein meaning of ‘normal price’ occurring in Section 4(1)(a) and its applicability when goods were sold at different prices to different buyers of same class etc. are to be determined. A perusal of the same, would not help the Revenue case.
3. We have considered the matter and find :
(a) Order relies on Supreme Court decision in the case of Hindustan Polymers. However the Final Order No. 1167/2001, dated 22-6-2001, does not however cover the aspect of removals, at a price lower or different from the declared prices to same class of buyers, which was also an issue. Therefore the order requires an addendum, when we follow Delhi High Court decision in the case of Krishan Madan reported in 2002 (140) E.L.T. 52 (Del.). We find that in the facts of this case an amendment to our order by an Addendum can be issued. The Addendum to para 2 therein as sub-para (c) be issued to our Order No. 1167/2001 as follows : “Addendum to para 2 of Order No. 1167/2001, dated 22-6-2001.
“(c) vide C.B.E. & C. 315/18/76-CX, 10/CX. I, dt. 30-7-1976, Circular No. 8/76 -CFV) Min. of Law, U.O. No. 23577/76-Advice (B), dated 2-7-1976 was circulated so as to avoid harassment to Trade by assessment on the highest prices, when many prices exist on the same day, etc. The Ministry of Law advice is –
“the first question is whether it would be permissible to take into account fraction of a day for constructing normal price i.e price fluctuations in the course of the day would all constitute ‘normal price’. This question is to be answered in the affirmative. The price prevailing at or nearest the lime or removal will constitute the normal price. In view of Rule 173C(4) the Collector may, having regard to the nature of the goods manufactured and the frequency of market price fluctuations of such goods, allow an assessee or class of asscssces to declare the price transacted for the, particular wholesale consignment on the gate pass subject to post verification by the assessing officers whether the price so declared is in conformity with the provision of Section 4 of the Act”.
This advice would, when read with C.B.E. & C. Circular 34/85 providing that a contract price, could be oral and should be accepted subject to post verification would induce us to conclude, that no duty demands on such prices which are lower and different than the prices declared can be effected in this case since no other material to question the same is available on record. At the most, penalty clauses of the Central Excise Rules can be invoked for not filing a reversed declarations of different prices. We find Rule 173CC provided for clearances of goods, when the prices approved were reduced. This rule has been omitted vide Notification 11/95-CE. (NT.), dated 16-3-95 w.e-f. 1-5-95. For the period under consideration in this case, price declaration No. 2/95/96, dated 22-5-95, the lower authorities had not imposed any penalty under the rules.”
4. The consequence of the order is, allowing the appeal against the demands of duty made, remain the same. Present ROM is allowed as Amendment addendum arrived as in para 3 herein above to our Order No. 1167/2001.