2017 (5) TMI 1014

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....rchase price. On investigation it was found that M/s.Duchem Laboratories Ltd. is a wholly owned subsidiary of M/s.Pfizer Ltd. It was also noticed that the appellant had entered into an agreement with Pfizer for marketing all product manufactured by the appellant. The appellant had entered into agreement with Pfizer Ltd. for technical sales promotion of their product. For the services taken from Pfizer Ltd. the appellant paid Pfizer Ltd. as per terms and conditions of the agreement. On the above said facts, the Revenue alleged that the product "Cardiovit" cleared to Duchem Laboritories Ltd. was nothing but a clearance to Pfizer Ltd. It was alleged that since the appellant had entered into an agreement regarding the sales promotion of "Cardio....

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.... order. He particularly relied on the terms of agreement between Pfizer and the appellant and on the fact that the entire goods are cleared to M/s.Duchem Laboratories Ltd. 4. We have gone through the rival submissions. The entire case of the Revenue is based on the assertion that the appellant and Pfizer Ltd. are related in terms of Section 4 of clause (3) (b) (ii) of Central Excise Act, 1944. It has been alleged that Pfizer Ltd. and Duchem Laboratories Ltd. are related to each other in terms of section 4 (3) (b) (ii) of the Act, since Duchem Laboratories Ltd. and Pfizer are interconnected undertaking. It has been alleged that since the appellants are related to Pfizer and Pfizer is related to Duchem Laboratories (by virtue of being hold....

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.... (a) in consideration of the services rendered and the cost and expenses incurred by Pfizer in connection with the promotion of the specified assessee's products, the assessee will pay to Pfizer such services as are mutually agreed upon between the parties hereto on each unit of the specified assessee's product sold and/or issued by the said Duchem Laboratories Ltd. in such accounting period as may be indicated by Duchem Laboratories Ltd. to the assessee from time to time. Such fixed service charges shall be paid within ten days from the receipt of details thereof from Duchem Laboratories Ltd. or within such extended time as may be mutually agreed by the parties hereto. The fixed service charges shall be recorded in a confirmation note furn....