TaxTMI 
TaxTMI 
2010 (9) TMI 257
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.... Act) and the Standards of Weights and Measures Act, 1976 (SWM Act). The appellants were of the view that there was no requirement of affixing MRP following Rule 34(b) of the Standards of Weights & Measures (Packaged Commodities) Rules, 1977 [PC Rules for short] as the unit weight of the goods was below 10 gms. Moreover, they claimed that their product was packed in 'wholesale package' and was meant for wholesale dealers as per Rule 29 of the PC Rules. They were not required to affix the MRP on the said packages in view of the clarification given by the Central Board of Excise & Customs vide Circular No. 625/16/2002-CX, dated 28-2-2002 and Letter No. F.341/64/97-TRU, dated 11-8-1997. Thus, according to the appellants, Section 4A was not applicable to the said goods. Individual pieces weighing around 5.5 gms was twist wrapped with printed laminated film. Several such individual pieces weighing 0.825 Kg. were packed in pet jars or 0.220 Kg. poly bags. Each individual piece carried the marking on the wrapper "MRP Re. 1/-". On pet jars/poly bags, there were markings "Re. 1 per unit" and "Wholesale Pack. To be opened and sold loose." However, Revenue did not subscribe to these views of ....
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.... arguments citing the relevant definitions as follows. Rule 2(x). "Wholesale package" means a package containing : (i) A number of retail packages, where such first mentioned package is intended for sale, distribution or delivery to an intermediary and is not intended for sale direct to a single consumer; or (ii) A commodity sold to an intermediary in bulk to enable such intermediary to sell, distribute or deliver such commodity to the consumer in smaller quantities, or (iii) Packages containing ten or more than ten retail packages provided that the retail packages are labeled as required under the rules." Rule 2(j). "multi-piece package" means a package containing two or more individually packaged or labelled pieces of the same commodities of identical quantity, intended for retail sale, either in individual pieces or the package as a whole;" Rule 2(p) : "retail package" means a package containing any commodity, which is produced, distributed, displayed, delivered or stored for sale through retail sales agencies or other instrumentalities for consumption by an individual or a group of individuals. Rule 2(q) "retail Sale" in relation to a comm....
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....r to define cases in which the particular set of information is required to be given on the package. Whether a packaged commodity is intended for retail sale or not will depend on the manufacturer and the marketing pattern adopted by him. Rule 3 of the said Rules, clearly states that the provisions of that Chapter shall apply to packages intended for retail sale and the expression 'package' wherever it occurred in that chapter shall be construed accordingly. 5.3 In the instant case, the appellant (manufacturer) is clear in his mind that the impugned goods are required to be sold only in wholesale and not meant for retail sale to the ultimate consumer. The pet jars/poly bags being 'wholesale packages' are sold through intermediaries and never intended to be sold directly to the ultimate consumer. 5.4 It is therefore submitted that the pet jars weighing 825 gms and containing 150 pieces and poly bags weighing 220 gms and containing 40 pieces are 'wholesale packages'. Appellant also relied upon the provisions of Rule 34(b) of the PC Rules, which read as follows : "'Nothing contained in these rules shall apply to any package containing a commodity, if, - (a)&nbs....
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.... of the PC Rules. 6.2 In the case at hand, the impugned goods are cleared in wholesale packages and the declarations as stipulated under Rule 29 of the PC Rules have been affixed on such packages. Therefore there was no requirement to affix MRP on the impugned goods as they were not intended for retail sale. 7. The CBEC in the circulars issued from time to time had clarified that even if a commodity is notified under Section 4A , if there is no statutory requirement under the law for declaring the MRP on the packages cleared by the manufacturer, then the assessments have to be done under Sec. 4 and not Sec. 4A. Even otherwise, the PC Rules are not applicable to the impugned goods cleared in packages vide Rule 34(b) ibid as the impugned product is less than 20 grams and is sold by weight. 7.1 If the law as settled by the Apex Court were applied to the instant case, the impugned goods are liable for assessment only under the provisions of Sec. 4 of the Act and not Sec. 4A. 7.2 They relied upon the decision of the Hon'ble Tribunal, Chennai Bench , in an identical case in Central Arecanut & Cocoa Marketing & Processing Co-op Limited v. CCE, Mangalore....
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.... bags are also available in retail. The relevant definition of retail sale and Rule 6 were cited. Rule 6 of PC Rules referred to stipulates as follows : Every package shall bear on it or on a label fixed thereto a definite, plain and conspicuous declaration as per the provisions of Chapter II of PC Rules furnishing name and address of the manufacturer/packer/importer, generic name of commodity, quantity (standard unit of weight or measure or number), month and year of the manufacture' packing, etc. 8.1 The pet jars and poly bags contained all the details required under Rule 6 of the said Rules and the same are intended for sale in retail and thus qualifies as retail pack as per Rule 2(p) of the PC Rules. In the instant case, the pet jars and poly bags contained the details under Rule 17 and thus fulfils the requirement under the said rules. Thus the pet jars and poly bags are only multiple-piece packages. 8.2 In the retail trade the impugned product is bought and sold in numbers only. When the impugned product is sold in numbers, the provisions of Rule 34(b) of the PC Rules are not applicable. 8.3 The impugned products put up in pet jars and poly bags ....
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....urt. It is submitted that the impugned product is required to be assessed under the provisions of Section 4A of the Act. 10. We have heard both sides. 11. The referral order framed the following questions :- (i) Whether the pet jars/poly bags containing individual pieces of Eclairs weighing less than 5.5 gms each should be considered as a 'wholesale package' as contended by the appellants and agreed by the Mumbai Bench or whether they should be considered as 'multi-piece package' as per the views of this Bench? (ii) Whether the exemption under Rule 34(b) of Standards of Weights & Measures (Packaged Commodities) Rules, 1977 available for individual pieces is relevant for deciding if the assessment has to be done under Section 4 or 4A of the Central Excise Act? (iii) Whether the assessment of the impugned products should be done under Section 4 or Section 4A of the Central Excise Act? 11.1 In the Swan Sweets Pvt. Ltd. case, the Tribunal observed that the individual package weighed below 10 gms. A multi-piece package contained two or more individually packaged or labeled pieces of the same commodity of identical quantity intended for ....
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....r or poly bag. 11.3 The form in which the goods were cleared by the manufacturer was not a relevant factor for deciding whether the impugned goods should be assessed under Section 4 or 4A. The Tribunal relied on the observation contained in BPL Telecom (P) Ltd. v. CC, Cochin [2004 (168) E.L.T. 251 (Tri.-Bangalore)] that "the definition makes it clear that 'retail sale' includes "distribution or delivery of such commodity through retail sales agencies or other instrumentalities for consumption by an individual.". The pet jars/poly bags were apparently retail packages attracting assessment under Section 4A. 12. We have perused the case records and considered the rival submissions. In the Swan Sweets (P) Ltd. case, the Tribunal held that the pet jars/plastic bags containing individual pieces of chocolate weighing less than 5.5 gms were retail packages excluded from assessment under Section 4A. These packages containing 72/140 pieces were wholesale packages. The Chennai Bench of the Tribunal in Central Arecanut & Cocoa Marketing & Processing Co-op Limited v. CCE, Mangalore [2008 (226) E.L.T. 369 (Tri - Chennai)] followed the decision in the Swan Sweets (P) Ltd. case a....
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....open court on……………….) Sd/- (P. Karthikeyan) Member (Technical) 14. [Order per : D.N. Panda, Member (J)]. - I have gone through the order recorded by my learned brother Sri Karthikeyan in the present reference. A Larger Bench has neither appellate jurisdiction nor revisionary powers to settle facts of a case referred to it or decide result of an appeal. It merely exercises advisory jurisdiction derived by it by virtue of reference made to it by the Hon'ble President of the Tribunal. It has no jurisdiction to reverse decision arrived at in an appeal except laying down the law for application thereof by the referring bench to arrive at its own decision which is essence of fair and objective administration of law with abundant caution that the decision of the Judge or Tribunal must be absolutely unfettered by any extraneous guidance. This is based on the self imposed discipline and the maxim : what cannot be done directly that cannot be done indirectly. If the exercise of discretion conferred on a quasi judicial Tribunal is controlled by any means, that forges fetters on the exercise of quasi judicial function and the presence of such fetters woul....
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....oly Bag or Pet Jar. Hence, there was a requirement of printing the MRP on the Pet Jar or Poly Bag. On such premises, the assessment has to be necessarily done u/s 4A of the Act as held by the lower authorities. (D) It was also the finding of the Division Bench in Para 5.2 of the order that the appellants have confused the issue saying that the Cartons containing Pet Jars are not meant for ultimate consumers and hence, there is no requirement for printing the MRP. This amounts to obfuscation of the issue. No manufacturer clears the goods directly to the ultimate consumers. The form in which the goods are cleared by the manufacturer is not a relevant factor for deciding whether the impugned goods should be assessed u/s 4 or 4A of the Act. Such view of the Bench was supported by the findings of the CESTAT in para 6 of the decision in the case of BPL Telecom (P) Ltd. v. CCE, Cochin - 2004 (168) E.L.T. 251 (Tri - Bang). (E) Denying the benefit of Rule 34(b) of the Rules, the Bench in Para 5.2 of the referral order held that the packages are actually "multi-piece package" and once this position is accepted, there was requirement to print the MRP ....
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....le (1) of the said rule, the declaration of quantity shall be made in terms of such unit of weight, measure or number as would give accurate and adequate information to the consumer with regard to the quantity of the commodity contained in the package. 20. The Fifth Schedule appended to Rule 12(2) contains a list of commodities in packaged form which may be sold by "weight", "measure" or "number" as mentioned in that schedule against the corresponding commodity. The impugned commodity does not appear in Fifth Schedule. 21. Chapter V of the Rules has made express provision by Rule 34 to exempt any package containing a commodity from applicability of the Rules through its clause (b) if "the net weight of the commodity at the relevant point of time was twenty grams or twenty millilitres or less or less if sold by weight or measure. 22. Whether a particular package is a retail package or a wholesale package is a question of fact to be decided in each case applying the relevant definition. In the case of Swan Sweets (supra), the Mumbai Bench held the packages in that case to be wholesale packages. One of the considerations that weighed with the Bench was that ....
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....ing of fact by the referral Division Bench that the impugned poly packs and pet jars are multi-piece retail packages, based on facts of this case and evidence available in this case, is sound. (ii) The exemption under Rule 34(b) of the rules will be available in respect of a multi-piece retail package if the total weight of all the pieces in the multi-piece package does not exceed the prescribed limit as held by Krafttech Products (supra) and Urison (supra). (iii) view of the finding of fact by the referral Bench in this case that the impugned poly packs and pet jars are multi-piece retail packages and the total weight of the pieces in such packages exceed 20 gms, the exemption under Rule 34 (b) is not applicable and consequently, the assessment is required to be done applying provisions of Section 4A. 27.The Registry is directed to return the appeals to the referring Division Bench for passing the final order. Sd/- (D.N. Panda) Judicial Member 28. [Order per : Chittaranjan Satapathy, Member (T)]. - I agree with the order recorded by the Honourable Judicial Member. Sd/- (Chittaranjan Satapathy) Technical Member &n....