2016 (6) TMI 439

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.... the amortized value of the packing materials. However, in some cases, their customers bring the packing materials i.e. plastic containers themselves, in which case the appellant is charging only the cost of the Glycol. In such cases, the duty is being paid by the assessee only on the price of Glycol. 2. Revenue, by entertaining a view that even in such cases i.e. where their customers bring their own plastic containers, the amortized cost has to be added in the assessable value of the Glycol, initiated proceedings against them by way of issuance of show cause notice dated 6.9.2004 raising demand of duty to the extent of Rs. 2.33 lakhs approximately for the period 2001-04. The Original Adjudicating Authority observed as under:- ....

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.... In view of the above discussions, I drop the proceedings against the party." 3. Revenue being aggrieved with the said order, filed an appeal before the Commissioner (Appeals). The Appellate Authority held that the said decisions relied upon by the Original Adjudicating Authority cannot be held applicable when there was a change in the provisions of Section 4. He further observed that brining of the packing material by the customers themselves amounts to flow back of the money to the manufacturer and as such, it can be concluded that the price was not the sole consideration, in which case the provisions of Section 6(3)(i) of the Valuation Rules, 2002 would apply. He accordingly reversed the order of the Original Adjudicating Authority ....

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.... Apex Court in cases of Hindustan Polymers (supra), Jauss Polymers Ltd. (supra) and CCE v. Superior Products (supra) is also applicable to Section 4, as it stands w.e.f. 1-4-2000, as the Apex Court in para 51 of its judgment in case of Bombay Tyre International (supra) has held that the statutory provision regarding inclusion of packing charges calls for strict construction, as levy is sought to be extended beyond the manufactured article itself and accordingly the cost of only that packing would be includible in the assessable value which is necessary to make the goods marketable and this principle would be applicable while interpreting the provision of Section 4, as it stands w.e.f. 1-7-2000, as the nature of the levy of Central Excise du....