TaxTMI 
TaxTMI 
2007 (9) TMI 162
X X X X Extracts X X X X
X X X X Extracts X X X X
....uty accordingly. The department was of the view that all the goods were liable to be assessed under Section 4A of the Act on the basis of MRP read with Notification No.13/2002-CE (NT). Hence the above demand of differential duty. 2. After examining the records and hearing both sides, we note that, in respect of the goods cleared by the assessee to "EMAMI" in the first category, the department called for clarifications from the Controller of Legal Metrology in terms of the Board's Circular No.625/16/2002-CX dated 28.2.2002 (wherein it had been instructed that, in case of doubt as to whether, in respect of a particular commodity, the assessee was exempted from declaring retail price or not under the Standards of Weights & Measures Act and the Rules made thereunder, clarification could be obtained from the concerned Department (generally, Metrology Department) of the State Government. The Controller of Legal Metrology clarified as follows :- "I am to further clarify that there is no specific provision either in the Standard of Weight and Measures Act, 1976 or in the Standard of Weights and Measures (PC) Rules, 1977 prohibiting free supply of goods along with other co....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e so purchased at that price by M/s.Pepsico was meant for free supply of the same along with one bottle of Pepsi of 1.5 litres in pursuance of their Sales Promotion Scheme. The appellant cleared the disputed goods after payment of duty at Rs.4.80 per chocolate in terms of Section 4 of the Act after filing the due declaration on the premise that since the chocolates were being sold to M/s.Pepsico, this was not a retail sale and on such chocolates supply there was no requirement to display the maximum retail price and as such the chocolates could not be covered under Section 4A and would eventually be assessable under Section 4 of the Act. However, the Department did not accept this and it issued a show cause notice dated 14.8.2001 raising a demand of Rs.48,95,370/- along with the proposal to impose penalty upon the appellant with interest. This proposal was contested by the assessee on the aforementioned plea that it was not required to print the MRP under the provisions of SWM Act and the Rules made thereunder. The Commissioner did not accept this and confirmed the demand. The appellant having failed in its appeal before the Tribunal has now approached this Court ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....xcise authorities and hence the matter was referred to the Controller of Legal Metrology. The clarification offered by the said authority is to the effect that there is no legal bar in scoring off the MRP (already printed on a product) with an intent to supply the goods free of cost along with other consumer goods. This opinion of the Controller of Legal Metrology, who is the authority empowered to assess the provisions under the Standards of Weights & Measures Act 1976 and the Rules made thereunder, cannot, in our opinion, be ignored. 3. Learned Jt. CDR has sought to distinguish the case of Nestle India Ltd. (supra) from the present case, by submitting that M/s. Nestle India Ltd. had not made any markings on the goods supplied to the buyer for free distribution along with "pepsi bottles' and that, it was the buyer who made such markings on the free supply goods. We are not impressed with the distinctions sought to be drawn between the two cases. The case of the assessee is that, in marking MRP on the goods and then crossing it, they only intended to convey to the buyer the worth of the goods under free supply. The Controller of Legal Metrology has not found anything wrong....
X X X X Extracts X X X X
X X X X Extracts X X X X
....mmodity) Rules and that such goods are required to be sold by weight or volume and declaration in respect of such goods is also required to be made in terms of weight or volume. Admittedly, the "shampoo" in question is a cosmetic item covered by Sl. No. 25 of the Table in the V Schedule ibid. Learned counsel has submitted that Rule 34 of the aforesaid rules is applicable to cosmetics which are intended to be sold either by weight or by measure (volume). It was without noticing the V Schedule and the connected Rule 12 that the Hon'ble High Court held that the goods in question was not intended to be sold either by weight or by measure and consequently rejected the claim of the writ petitioner that Rule 34 was applicable to their goods. We have found a valid point in these submissions of learned counsel. As rightly observed by the Larger Bench in Urison Cosmetics (supra) the decision in Varnica Herbs case was rendered per incuriam without noticing the provisions of the V Schedule to the Standards of Weights and Measures (Packaged Commodity) Rules. The decision of the Larger Bench is also in support of the present appellant's case. Learned Jt. CDR has made an endeavour to support....