ORDER
Shri G.A. Brahma Deva
1. A Show Cause Notice has been issued to M/s Carbo Graphics (P) Ltd. alleging that they have cleared printing ink falling under heading No 3215 of Central Excise Tariff Act, 1985 without discharging full duty liability. The party had availed benefit of Notification No 1/93 dated 28.2.93. The Show Cause Notice has been issued on the ground that the party was suppressing the fact of using brand name/label of another manufacture of the product and also collected service charges which were not included in the clearances. Accordingly, show Cause Notice was issued and demanded duty amounting to Rs 10,05,018.60 during the period from 1-4-92 to 15-6-95. The matter was adjudicated by the Commissioner and confirmed the demand proposed in the Show Cause Notice in addition to imposing penalty.
2. Arguing for the assessee, Shri KR Natarajan, learned Advocate submitted that M/s Bennett Coleman Ltd. are the main customer whom they have supplied in containers of higher capacity. He submitted that the appellants used to supply containers over 20 Kgs and more did not bear the brand name since it was supplied to main customer. He submitted that this important aspect was not considered by the adjudicating authority by denying the small scale exemption. The Commissioner denied the benefit in respect of total quantity clearance by M/s Carbo Graphics (P) Ltd. Further more he submitted that while determining the assessable value, duty element as envisaged under section 4 (4) (d) (ii) is deductable but same has not been done. In support of his contention he referred to decision of the Tribunal in the case of Srichakra Tyres Ltd & Ors. reported in 1999 (32) RLT 1 (CEGAT-Larger Bench). He also submitted that the party is entitled modvat credit and same has not been considered by the adjudicating authority. In support of his contention he referred to a series of decisions including in the case of M/s Agarwal Metal Industries Vs. Commissioner of Central Excise, Bangalore (1998 (102) ELT 663. As regards valuation, he referred to the decision of the Supreme Court in the case of Baroda Electric Meters Ltd. Vs. Collector of Central Excise reported in 1997 (94) ELT 13 (SC) wherein it was held that freight actually paid less than the amount collected by way of freight and transportation charges and the difference was appropriated cannot be added in the assessable value.
3. Smt. Radha Arun, SDR appearing for the Revenue submitted that sufficient evidence was brought on record to show that goods were cleared by affixing bearing brand name of another manufacturers. She also submitted that 20 Kgs of container found in the factory premises bearing brand name. She also submitted that department has justified in denying small scale exemption in terms of Notification No 1/93. She also submitted that ratio of the decision of the Supreme Court is not applicable to this case since invoice value is cum duty price.
4. We have carefully considered the matter. We find lot of force in the arguments advanced on behalf of the assessee with reference to the statutory deduction in terms of Section 4.4(d) (ii) in determining the assessable value and of valuation relying upon the decisions referred to above. Plea of the entitlement of modvat credit also cannot be turned down in the facts and circumstances. In view of this position, we are of the view that the entire matter required to be examined afresh by the adjudicating authority. In the view we have taken, we are remanding the matter to the jurisdictional Commissioner to decide the matter afresh and to pass an appropriate order in accordance with the law on providing an opportunity to the party. All the issues are kept open.
5. Thus, this appeal is allowed for way of remand.
(Pronounced and dictated in the open court)