IN THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL
WEST ZONAL BENCH AT AHMEDABAD
Appeal No. E/357/2007
Arising out of Order-in-Original No.1-2/DEM/VAPI/2007, dt.4.1.07
Passed by: Commissioner of Central Excise & Customs, Vapi.
M/s Castrol India Ltd.
CCE & C Vapi
Respondent/s Represented by : Shri D.S. Negi, SDR
Appellants Represented by : None
MRS. ARCHANA WADHWA, MEMBER (JUDICIAL)
MR. M. VEERAIYAN, MEMBER (TECHNICAL)
Date of Hearing: 08.01.08
Date of Decision:
ORDER No. /WZB/AHD/2008
Per: Mrs. Archana Wadhwa, Member (Judicial)
On matter being called, neither anybody appeared for the appellant nor is there any request for adjournment. We have heard Shri D.S. Negi, learned SDR for the Revenue and gone through the impugned order. The appellant is engaged in the manufacture of lubricating oil falling under chapter heading No.2710.90 of the Schedule to CETA, 1985. The said goods were covered under the provisions of Section 4A Central Excise Act w.e.f. 1.3.99, which provides for payment of duty on the basis of Maximum Retail Price (MRP) affixed on the same. Valuation under the Section 4A can be resorted to, when the commodity is notified under the said Section and there is a statutory requirement to affix the MRP under the provisions of Standards of Weight & Measures Act (Packaged Commodity) Rules, 1977. The appellants are paying duty in accordance with the said Section in respect of the retail packs of various sizes which range from 1 ltr. to 50 ltrs.
2. The dispute in the present appeal relates to the unit pack of 210 ltrs of lubricating oil, on which the duty is being paid by the appellant in accordance with the valuation adopted as per Section 4 on the ground that 210 ltrs. barrel of lubricating oil is not a retail pack but a wholesale pack and there is no requirement to affix any MRP on the same. The adjudicating authority vide his impugned order has held that such 210 ltr. barrel cannot be held to be a wholesale package, in terms of provisions of Rule 2(x)(ii) of Standards of Weight & Measures Act (Packaged Commodity) Rules, 1977 and the same are liable to pay the duty in terms of provisions of Section 4A.
3. We find that the provisions of Section 4A provides for payment of duty of Excise in respect of the notified goods in relation to which it is required, under the provisions of Standards of Weight & Measures Act 1976 or the Rules made there-under to declare on any package maximum or retail sale price of such goods. Admittedly no retail sale price of the goods stand affixed on 210 ltr. packing, in as much as the appellants are considering the said packing as a wholesale package meant for industrial use directly by their customer. In terms of the Standards of Weights & Measures Act, the MRP is required to be affixed on the retail pack and not on the wholesale pack or bulk pack. The appellants are retailing their goods in packs of sizes of 500 ml, 1 ltr, 2 ltrs, and 5 ltrs. etc. They have strongly contended that the clearances of the lubricating oil in 210 ltr. barrel is directly to their customers and need not be affixed with MRP as in the case of retail pack.
4. We find that the department has sought clarification from the Legal Metrology Department, Chennai, which administers the provisions of Standards of Weights & Measures Act. It stands clarified by the Controller of Legal Metrology in their letter dt.21.4.05 that 210 ltr. pack will be covered under the definition of wholesale package as defined under the Standards of Weighs & Measures Act and in terms of Rule 29 of the said Rules and it is not mandatory for the manufacturer to declare the MRP on such 210 ltr. barrel. The Commissioner, instead of accepting the above clarification issued by the concerned department, has himself examined the provisions of Rule 2(x) of the said Act and have arrived at the finding that such packages cannot be considered as wholesale packages. Such approach by the adjudicating authority is not in accordance with the jurisprudence provisions. The authorities under the Standards of Weights & Measures Act are the best judge to decide as to whether a product is required to be affixed with a MRP under the said Act or not. If said authority has clarified that 210 ltr. barrel are not required to be affixed with MRP, it was obligatory on the part of the Excise authority to accept such decision of Controller of Legal Metrology authority. Section 4A gets invoked only when the goods are required to be affixed with the MRP under the Standards of Weights & Measures Act and if the authorities under the said Act has clarified that no such MRP is required, it was not open to the Excise authority to doubt the decision of the authority under Standards of Weights & Measures Act and to proceed independently to decide as to whether the goods are required to be affixed MRP under the Standards of Weights & Measures Act. In the light of the clarification issued by Metrology department, we find no justification to hold that the provisions of Section 4A would apply to 210 ltrs. barrel of lubricating oil.
5. We, accordingly, set aside the impugned order and allow the appeal with consequential relief to the appellant.
(Pronounced in Court on 11.01.2008)