TaxTMI 
TaxTMI 
1989 (5) TMI 65
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....aining the price at which five companies to which it sold its entire output (hereinafter referred to as the customer companies) sold those products. The customer companies thereafter sold their products. The respondent challenged the direction of the Superintendent and had contended that for the purpose of levy of excise duty the value of its products should be the prices at which it sold those products to the customer companies and not the prices at which these in turn sold those products to wholesale dealers or others. The respondent-company was registered under the Indian Companies Act, 1913. At the relevant time, there were five shareholders of the company, namely, Bajaj Electricals Ltd., Bombay, Crompton Parkinson Ltd., London, N.V. Ph....
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....-company to its customer companies for its products or the prices charged by the customer companies when they sold them to wholesale dealers and others, should be the basis for determination of the value for levy of excise duty. Being aggrieved by the insistence of the central excise authorities that the latter prices should be the value for levy of excise duty, the respondent-company approached the High Court of Allahabad by Civil Misc. Writ No. 2189 of 1973. The High Court by its order dated 14th May, 1974, allowed the writ petition and held that the prices at which the respondent-company sold its products to the customer companies, should be the value for levy of excise duty and not the price at which the customer companies sold these to....
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.... Court in A.K. Roy v. Voltas Ltd. 1977 (1) E.L.T. (J 177) and also in Union of India v. Atic Industries Ltd. 1984 (17) E.L.T. 323 (S.C.) = 1984 (3) SCR 930. 4. The real question that arose in this case is whether the five customer companies can be regarded as "related persons" as defined in Section 4(4) (c). The definition of that consists of two parts. The first part refers to a person who is so associated with the assessee that each has interest, directly or indirectly in the business of the other and the second part of that definition refers to a holding company, a subsidiary company, a relative and a distributor of the assessee and any sub-distributor of such distributor. The High Court held that in order for the respondent-company t....
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....ies (India) Pvt. Ltd. ceased to be a subsidiary company wholly owned by the Imperial Chemical Industries Ltd., London on 13th March, 1978, since 60 per cent of the share capital of Imperial Chemical Industries (India) Pvt. Ltd., was offered to the public in pursuance of the policy of the Government of India requiring that not more than 40 per cent of the share capital of an Indian company should be held by a foreign shareholder. Consequent upon this dilution of foreign shareholding, the name of Imperial Chemical Industries (India) Pvt. Ltd. was changed to Crescent Dyes and Chemicals Ltd. The assessee in that case at all material times sold the large bulk of dyes manufactured by it in wholesale to Atul Products Ltd. and Imperial Chemical Ind....
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.... each other. It is not enough that the assessee has an interest, direct or indirect in the business of the person alleged to be a related person nor is it enough that the person alleged to be a related person has an interest, direct or indirect in the business of the assessee. To attract the applicability of the first part of the definition, the assessee and the person alleged to be a related person must have interest direct or indirect in the business of each other. Each of them must have a direct or indirect interest in the business of the other. The quality and degree of interest which each must have in the business of the other may be different; the interest of one in the business of the other may be direct while the interest of the lat....