2006 (7) TMI 75 - AT - Central Excise

Tribunal decision: Valuation of goods under statutory requirements

The Tribunal upheld the Commissioner (A)'s decision to value aerated waters under Section 4A instead of Section 4, despite being supplied free of charge. ... Valuation (Central Excise )- Under a contract Aerated water supplied to another person for further supply of same as free gift alongwith other item- Assessee require declare its retail price and its valuation governed by section 4A. Issues:Valuation under Section 4A vs. Section 4 for goods supplied free of charge.Analysis:The case involves a dispute over the valuation of aerated waters cleared in unit containers by the Respondents, which were ultimately supplied free of charge by a purchaser. The Revenue contended that the valuation should be done under Section 4 instead of Section 4A. The Adjudicating Authority confirmed a demand, but the Commissioner (A) ruled that the valuation should be under Section 4A, setting aside the lower authority's order.The Revenue challenged the Commissioner (A)'s decision on the grounds that for Section 4A valuation, a retail sale to the ultimate consumer is necessary, which was not the case here as the goods were supplied free. They cited a precedent and a Circular to support their argument. The Respondents' counsel argued in favor of the Commissioner (A)'s decision, emphasizing that the goods fell under Section 4A due to the statutory requirement to declare retail sale price under the Weights and Measures Act.The Tribunal examined the case records and upheld the Commissioner (A)'s findings. They reiterated that the statutory requirement under the Weights and Measures Act mandated the declaration of retail sale price, making Section 4A applicable. The Tribunal referenced a previous case involving similar facts and statutory provisions, emphasizing that once goods are specified under Section 4A(1), the duty of excise is to be assessed based on the declared retail sale price, unless exceptions apply.In conclusion, the Tribunal found the Commissioner (A)'s reasoning sound and in line with the law. They noted that the previous decision cited by the Revenue was under challenge but not stayed, hence not a valid ground to disregard it. Therefore, the Tribunal rejected the Revenue's appeal, affirming the valuation under Section 4A for the goods in question.