TaxTMI 
TaxTMI 
2011 (5) TMI 725
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....rious depots for being sold to their dealers in packaged form. The value of the base paints, so manufactured and cleared, had been determined by them under Section 4A of the Central Excise Act, 1944 and in terms of the Notification No.13/2002-CE(NT) dated 01/03/2002 upto 28/02/2006 and under the Notification No.2/2006-CE(NT) dated 01/03/2006 thereafter. It was noticed that at the dealers premises, these base paints were mixed with various shades derived from the colour bank dispensing machine. The bought out colourants were mixed in these base paints to obtain the desired colour and shades. Thus, the base paints manufactured and cleared by the noticee was not sold to or purchased by the ultimate consumer and was meant for supply to the dealers, where it underwent change and perceptible modification by opening of the package and adding and mixing of the desired colourants prior to its delivery to the ultimate consumer. 3. Rule 1 (3) of the Standards of Weights and Measures (Packaged Commodities) Rules, 1977 (hereinafter referred to as 'the SWM (PC) Rules, 1977 for sake of brevity) is applicable only to commodities in packaged form.Rule 2 (1) th....
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....the demands as per the show-cause notice) vide order No.447/448/2009 dated 15/04/2009, which was appealed against by the department and before the Hon'ble apex Court and the Hon'ble apex Court vide order dated 11/01/2010 has dismissed the appeal filed by the department in the facts and circumstances of the case. As the issue is identical which has attained finality by the decision of Chennai Bench of the Tribunal as well as by the Hon'ble apex Court. Therefore, the adjudication order be set aside and appeal to be allowed with consequential relief. 7. Shri K.M. Mondal, Ld. Consultant for the Revenue appeared before us who contended that the facts of this case are not similar to the case before the Chennai Bench of this Tribunal. To differentiate the facts, he drew our attention to para 23 of the impugned order wherein the adjudicating authority has observed that, the explanation 2 to Section 4A of the CEA, 1944 provided that in case where on the package of any excisable goods have more than one retail price is declared, the maximum of such retail sale price shall be deemed to be retail sale price. The appellant determined the value of the base p....
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....llants to pre-packed paint for delivery to the ultimate consumer upon mixing of colourants through the computerized automatic dispensing machines for paint in standard quantities as specified in Schedule III to the SWM Rules 1997. Therefore, the appellants were allowed to pre-pack base material of paints for making paints to be delivered through the said computerized machine, after specifying the certain condition. It does not mean that the appellants goods are covered by the Standard of Weights and Measures (Packaged Commodities) Rules 1977. Therefore, finally he prayed that the facts of this case are distinguishable from the facts of the case decided by the Chennai Bench of this Tribunal, hence, the impugned order is to be upheld. In alternate, he further prayed that in view of the submission made herein above, the matter be referred to the Larger Bench. 9. On careful examination of the submissions made by both sides, the first issue before us is that whether the facts of the matter before the Chennai Bench of this Tribunal and the matter in hand are identical or not. To know the facts, the show-cause notice issued in both the cases are re-produced here in und....
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....ng base is opened and perceptible modification is made of the content of the package before delivering the same to the consumer. 4. In terms of Rule 1(3) of the Standards of Weights and Measures (Packages Commodities) Rules, 1977 (hereinafter referred to as PC Rules) the Rule is applicable only to commodities in packaged form. In terms of Rule 2(1) of the above said Rules, '(1) Pre-packed commodity with its grammatical variations and cognate expressions means a commodity or article or articles which, without the purchaser being present, is placed in a package of whatever nature, so hat the quantity of the product contained therein has a pre-determined value and such value cannot be altered without the package or its lid or cap, as the case may be, being opened or undergoing a perceptible modification and the expression 'package;, wherever it occurs, shall be construed as a package containing a pre-packed commodity.' 5. From the above, it appears that the provision of the PC Rules, 1977 are applicable only to pre-packed commodity which has a pre-determined value and such value cannot be altered without the package or lid or cap being opened or undergoing perceptible modification....
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...., therefore, M/s Berger Paints (India) Limited, Pondicherry are hereby called upon to show cause to the Commissioner of Central Excise, Goubert Avenue, Pondicherry-605 001, within 30 days from the date of receipt of this notice as to why: i. the base cleared by them and assessed under Section 4A should not be assessed under Section 4 of the Central Excise Act, 1944. ii. Differential duty of Rs.9,48,29,097/- and differential Education Cess of Rs.8,39,937/-) (as per Annexure to this notice) should not be demanded from them in respect of clearances made during April 2002 and March 2006, under Sec. 11A of the Central Excise Act, 1944. iii. Appropriate interest on the said duty amount should not be demanded from them Sec. 4A of the Central Excise Act, 1944. iv. Penalty should not be imposed on them under Section 11AC of the Central Excise Act, 1944. 11. M/s Berger Paints (India) Limited, Pondicherry are further directed to produce at the time of showing cause all the evidences upon which they intend to rely in support of their defence. 12. If no cause is sh....
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....dards of Weights and Measures (Packages Commodities) Rules, 1977 (hereinafter referred to as PC Rules) the Rule is applicable only to commodities in packaged form. In terms of Rule 2(i) of the above said Rules, "(1) Pre-packed commodity with its grammatic variation and cognate expression means a commodity or article or articles which, without the purchaser being present is placed in a package of whatever nature, so hat the quantity of the product contained therein has a pre-determined value and such value cannot be altered without the package or its lid or cap, as the case may be, being opened or undergoing a perceptible modification and the expression package, wherever it occurs, shall be construed as a package containing a pre-packed commodity." 5. From the above, it appears that the provisions of the PC Rules, 1977 are applicable only pre-packed commodity which has pre-determined value cannot be altered without the package or lid or cap being opened or undergoing perceptible modification. In as much as the lid/cap of package containing the 'base' manufactured by Berger is opened at the dealer, premises and perceptible modification of the content is made before delivering the p....
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....able for penal action under Section 11AC of the Central Excise Act, 1944. 10. Now, therefore, M/s Berger Paints (India) Limited, Kundalm are hereby called upon to show cause to the Commissioner of Customs, Central Excise & Service Tax, Goa, having his office at, ICE House, EDC Complex, Patto Plaze, Panaji, within 30 days from the date of receipt of this notice as to why: (i) the 'base' cleared by them and assessed under Section 4A should not be assessed under Section 4 of the Central Excise Act, 1944. (ii) Differential duty of Rs.5,27,77,454/- (Five Crores Twenty Seven Lakhs Seventy Seven Thousand Four Hundred Fifty Four Only) and differential Education Cess of Rs.8,94,799/- (Eight Lakhs Ninety Four Thousand Seven Hundred Ninety Nine Only) as per Annexure to this notice, totally amounting to Rs.5,36,72,253/- (Five Crores Thirty Six Lakhs Seventy Two Thousand Two Hundred Fifty Three Only) should not be demanded and recovered from them in respect of clearances made during April 2002 to March 2007, under the proviso to Section 11A(1) of the Central Excise Act, 1944. (iii) Appropriate interest on the said duty amount s....