Tribunal: Odomos supplies to Armed Forces assessed under Section 4, not 4A

The Tribunal clarified that supplies of Odomos Repellant Cream to the Armed Forces and Para Military Forces should be assessed under Section 4 rather than Section 4A of the Central Excise Act, 1944. The Tribunal determined that such supplies, intended for institutional use and not for retail sale, do not constitute a sale and therefore should not be assessed under Section 4A. This decision provides clarity on the assessment criteria for supplies to institutional consumers, ensuring appropriate treatment under the Central Excise Act, 1944.

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Issues Involved: Assessment under Section 4 or 4A of CEA, 1944 for supply of Odomos Repellant Cream to Armed Forces/ Para Military Forces.

Analysis:

Issue 1: Assessment under Section 4 or 4A of CEA, 1944
The appeal was filed by the Revenue against the Order-in-Original passed by the Commissioner of Central Excise – Vapi. The main issue in question was whether the Odomos Repellant Cream supplied to the Armed Forces and Para Military Forces should be assessed under Section 4 or 4A of the Central Excise Act, 1944. The appellant argued that the entire supply was made exclusively to the Armed Forces and Para Military Forces for their use, and therefore, it should not be subject to assessment under Section 4A. The appellant relied on a decision of the Tribunal in a similar case involving supply to the Canteen Stores Department of the Ministry of Defence. The Tribunal in that case held that the assessment of such supply falls under the scope of Section 4A of the CEA, 1944. The Tribunal emphasized that the Canteen Stores Department is an in-house procurement agency for the armed forces, and the goods supplied are not for retail sale. Therefore, the value determined under Section 4 of the Central Excise Act, 1944 should determine the duty liability. Following this precedent, the Tribunal set aside the impugned order and allowed the appeal, stating that the supply made to the Armed Forces and Para Military Forces for their use only did not constitute a sale, and hence, should not be assessed under Section 4A.

Conclusion:
The Tribunal, in this case, clarified the assessment criteria under Section 4 or 4A of the Central Excise Act, 1944 for supplies made to the Armed Forces and Para Military Forces. By relying on a previous decision involving supply to the Canteen Stores Department, the Tribunal determined that such supplies should be assessed under Section 4 rather than Section 4A, as they are not intended for retail sale. The judgment provides clarity on the treatment of supplies to institutional consumers like the Armed Forces and Para Military Forces, ensuring appropriate assessment under the Central Excise Act, 1944.

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