Physician's samples in distinct packing retained exemption despite similar container appearance and the penalty could not stand.

Physician's samples cleared in separate pack sizes and marked with the prescribed inscription were treated as distinct from regular goods, so exemption under Notification No. 48/77 could not be denied merely because the containers shared similar colour, design or monogram. The prescribed condition was distinct packing with the required inscription on the individual container, and no additional requirement as to colour or design was imposed. On that factual basis, the exemption was available and the penalty under Rule 173Q could not be sustained.

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Issues: Whether physician's samples cleared in different packing with the prescribed inscription satisfied Notification No. 48/77 dated 1-4-1977 and whether the penalty imposed under Rule 173Q of the Central Excise Rules, 1944 could be sustained.

Analysis: The order of adjudication recorded a factual finding that the samples were packed in different quantities and were marked as physician samples not to be sold. The notification required distinct packing and inscription on the individual container, and it did not prescribe any condition regarding colour or design of the container. The factual difference in quantity was sufficient to show that the samples were distinct from regular packing, and the required inscription was admittedly present. The revenue reliance on the cited precedent was found inapplicable on the facts.

Conclusion: The appellant was held entitled to the benefit of the notification, the penalty could not survive, and the appeal was allowed.

Ratio Decidendi: Where physician's samples are packed distinctly from regular goods and bear the required inscription, exemption under the notification cannot be denied merely because the containers share similar colour, design, or monogram.

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