TaxTMI 
TaxTMI 
2007 (3) TMI 27
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....er referred to as M/s. DPL) and one of its buyers M/s. Royal Chemicals (Proprietary concern) are inter connected undertakings within the meaning of Section 2(g) of the Monopolies and Restricted Trade Practices Act, 1969, and therefore, the price of Rs. 118.56 being the price at which M/s. Royal Chemicals has sold Camphor to its customer during the Financial Year 2001-2002 was to be adopted as the price for all goods manufactured and sold by M/s. DPL to M/s. Royal Chemicals during the period in dispute. The provisions of Rule 11 of the Central Excise Valuation (Determination of Price of Excisable Goods) Rules, 2000 have been applied for the purpose of valuing the goods. 2. We have heard both sides. The case of the department is that the Duj....
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....eaning assigned to this expression in clause (g) of Section 2 of the MRTP Act, 1969. Section 2(g) of the MRTP Act defines inter connected undertakings as "two or more undertakings which are inter connected with each other in any of the following manner, namely - (i) if one owns or controls the other, (ii) where the undertakings are owned by firm, if such firms have one or more common partners, (iii) where the undertakings are owned by bodies corporate, (a) If one body corporate manages the other body corporate, or (b) if one body corporate is a subsidiary of the other body corporate, or (c) if the bodies are under the same management, or (d) if one body corporate exercise control over the other body corporate in any manner (iv) wher....
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....nstitute, or at any time within a period of six months immediately preceding the day when the question arises as to whether such bodies corporate are under the same management, constituted (whether independently or together with relatives of such director or the employees of the first mentioned body corporate) one-fourth of the directors of the other; or (v) if the same individual or individuals belonging to a group which holding (whether by themselves or together with their relatives) not less than (one-fourth) of the quantity shares in one such body corporate also hold (whether by themselves or together with their relatives not less than (one-fourth) of the equity shares in the other; or (vi) if the (same body) corporate or bodies corpo....
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....rate under the same management hold, in the aggregate, not less than (one-fourth) equity share in any other body corporate, such other body corporate shall be deemed to be under the same management as the first mentioned bodies corporate. Explanation-IV : In determining whether or not two or more bodies corporate are under the same management, the shares held by (financial institutions) in such bodies corporate shall not be taken into account." 3. The finding of the Commissioner is that M/s. DPL and M/s. Royal Chemicals are under the same management by virtue of clauses (v), (vi), (vii), (viii) & (ix) of Explanation 1 above, as the directors of the body corporate (DPL) are the proprietors of M/s. Royal Chemicals besides being personally r....
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....d to constitute assessable value of the goods sold by DPL for the purpose of determination of duty liability on goods manufactured by DPL, for the reason that not only is this price only an average price but is also the price at which camphor manufactured by DPL and sold to Royal Chemicals was in turn sold by Royal Chemicals in the financial year 2001-02 which is much prior to the period in dispute in the present appeal. Further, the price cannot also be adopted for goods other than camphor which have been manufactured by DPL and sold to Royal Chemicals. 5. We are further of the view that the provisions of Rule 11 of the Valuation Rules which have been applied by the adjudicating authority for the purpose of valuation of the goods are not ....