1989 (9) TMI 280

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....nal as an appeal under Section 35P(2) of the Act. 2. Brief facts of the case are that appellants M/s. Weikfield Products Company (India) Private Limited are manufacturers of Prepared or Preserved Foods which fall under the Tariff Item 1(B) of the Central Excise Tariff. During the relevant period i.e. from 1-10-1974 to 30-8-1975 they had sold their goods through two broad channels viz. directly to the Canteen Stores Department (hereinafter called CSD) and to the Weikfield Central Marketing Organisation (hereinafter called the CMO), allowing 20% and 30% discount to CSD and CMO respectively. According to the appellants higher discount was allowed to CMO because they were sole selling agents for civil sales in India and they have to incur co....

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....ed under the Companies Act, whereas the CMO is a registered partnership firm having separate legal entity. CMO cannot be considered as a related person under Section 4(4)(c) of the Act even if the partners and the Directors in these two concerns are relatives in view of the ruling given by this Tribunal in the case of G. D. Industrial Engineers v. Collr. of Cus. of Central Excise, Chandigarh, reported in 1983 (14) E.L.T. 1994 (CEGAT) = 1984 (3) ETR 393- in the case of Meteor Satellite Ltd., Kathwada, Ahmedabad and Telstar Electronics, Ahmedabad v. Collr. of Central Excise, Baroda, reported in 1985 (22) E.L.T. 271 (Tri.) = 1984 (4) ETR 359. Further, he brought to our notice where the Collector (Appeals) in his Order No. 510/PN-47/85 dated 14....

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....ere were different prices and different rates of discount. In support of his contention, he cited a decision of Voltas case reported in 1977 (1) E.L.T. Q 177). 4. Shri Krishnamurthy, learned S.D.R. appearing for the respondent justified the action of the authorities below in rejecting the refund claim of the appellants on the ground that the same was not at arm's length as the partners of the CMO were closely related with that of the appellants and hence, the excess discount cannot be allowed as the CMO was a favoured buyer. 5. We have considered the submissions and perused the records. The issues to be decided in this case are (i) whether CMO is a related person or favoured buyer, and (ii) whether the discount allowed by the appellan....