TaxTMI 
TaxTMI 
2016 (10) TMI 906
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....a manufacturer of surface coating materials, adhesives, glues and paints. The appellants have been clearing Superfine Spray Plaster packed in 25 kg. PP bags to M/s. NCC Maytas (JV), Pocharam at the rate of Rs. 175/- per bag as per the Purchase Order. The appellants had paid excise duty on the transaction value in terms of Section 4 of the Central Excise Act, 1944(CEA for short) on the goods sold in bulk for captive consumption by the construction industry. The appellants vide letter No.ACPC/3983/2003-04 dt. 30/12/2003 informed the Assistant Commissioner of Central Excise, Nalgonda Division that they had received Purchase Order for supply of Superfine Spray Plaster in bulk from NCC-Maytas for their consumption in construction and that they intend to supply the same packed in 25KG bags, on payment of excise duty under Section 4 of the CEA on the transaction value of Rs. 175/- per bag. However, a show-cause notice dated 25/01/2005 was issued to appellant proposing that the goods have to be assessed on the basis of Retail Sale Price in terms of Section 4A and not on the basis of transaction value in terms of Section 4 of the CEA, 1944. Adjudicating authority vide Order-in-Original No.4....
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....construction industry, The use of Surface Coating Material in the construction industry satisfies the condition of use of the goods as raw material or servicing of construction industry. The lower authorities have erred in not understanding that use of Surface Coating Material in construction industry is use of the said material as raw material. c. Even otherwise, supply of Surface Coating Material to the construction industry for their captive use amounts to supply for the purpose of servicing the said construction industry. Therefore, supply of Surface Coating Materials to NCC-Maytas for their own consumption in construction industry was exempt under Rule 34(1 )(a) of the Standards of Weights and Measures (Package Commodities) Rules, 1977, from declaration of Retail Sale Price among other declarations as required. Therefore, the appellants were not required to declare the Retail Sale Price on the goods sold to the Construction Industry and were not liable to assessment under Section 4A of the Central Excise Act, 1944. The payment of duty on the transaction value in terms of the CEA, 1944 was correct in law. 3.2. The learned Advocate further submitted that his argument....
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....acts placed before us, we find that the Hon'ble Supreme Court in the Jayanthi Food Processing case cited supra has laid down the law in regard to a situation in which goods are supplied for purpose of supplying any industry,etc to be eligible for exemption from affixation of MRP/Section 4A valuation. It is seen that the Apex Court has taken into consideration Circulars dated 28.02.2002 as well as the further clarificatory Circular dated 17.01.2007 relied upon by Ld. AR. The said Rule 34, though amended w.e.f. 17.07.2006 (new Rule 2A), has only further enlarged the scope of institutional consumer and industrial consumer for the purposes of exemption from affixing the MRP. 7. The decision laid in the case of ITEL Industries which is relied by department, is not applicable to the case on hand as the facts are distinguishable. The case involved bulk supply of telephone instruments with MRP indicated upon them to DOT/MTNL who lent the same to subscribers while retaining their ownership. It is not the case that such instruments were being supplied as raw materials or for the purpose of servicing any industry. The facts of the case in Liberty Shoes (supra) is also pla....
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.... a specific declaration that the SWM (PC) Rules shall not apply to any "package" containing a commodity if the marking on the package unambiguously indicates that it has been specially packed for the exclusive use of any industry as a raw material or for the purpose of "servicing any industry, mine or quarry". Learned Counsel points out that the "package" which is sold by the assessee mentions that it is specially packed for the exclusive use of the catering industry. Learned Counsel further argues that such "package" was for the purposes of "servicing the hotel industry or catering industry" as the case may be. Learned Counsel is undoubtedly right when he seeks to rely on Rule 34 which provides for exemption of the "packages" which are specially packed for the exclusive use of any industry for the purposes of "servicing that industry". Shri Subba Rao supported the view expressed by the Tribunal that the words "servicing any industry" could not cover the present case and he further suggested that ice-cream cannot be a "raw material" for any industry. He is undoubtedly right that the ice-cream cannot be termed as "raw material" for any industry. However, the words "or for the purpos....
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....ubba Rao. If that is so, the appeal would have to be allowed and it would have to be held that Section 4A will not apply to the ice-cream sold by the assessee. 8. It is interesting to note that the issue whether construction industry is a service industry was analysed by the Hon'ble High Court of Karnataka in the case of CCE, Bangalore Vs. Mysore Cements Ltd. [2010 (259) ELT 30 (Kar)] The relevant portion of the judgment is extracted below :- 2. ... ... ... The Tribunal relying on the Notification as well as the decisions of the co-ordinate Bench in the case of M/s. Grasim Industries Limited v. CCE, Jaipur reported in 2004 (175) E.L.T. 779 (Tri.-Del), which was followed by the Tribunal in the case of M/s. Chettinal Cement Corporation Limited v. CCE, Trichy reported in 2009-TIOL-139-CESTAT-MADRAS, where it was held that, Construction is treated as an industry under the various statutes and it in feet, is one of the biggest industries in any Country, the construction industry is a service industry and therefore, the assessee is entitled to the concessional rate of excise duty and therefore, it set aside the order passed by the adjudicating authority and held that....