1989 (6) TMI 61

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....eunder the latter agreed to buy the entire production of brassieres manufactured by the petitioners at an ex-factory rate based on the petitioners' manufacturing cost and manufacturing profits. The marketing and sales efforts in respect of these bras were put in by Dawn Mills and the prices at which they were sold were also fixed by Dawn Mills. 3. On 20th July 1974 the petitioners received a  notice from the Superintendent of Central Excise, Bombay, under the provisions of the old Section 4. The notice stated that it was seen from the invoices that the petitioners' entire production of bras was sold to Dawn Mills and that the price that the petitioners had declared for the purposes of assessment of excise duty was the price at whic....

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.... the aforesaid notices  were passed by the Assistant Collector of Central Excise, Bombay. He said that the petitioners had admitted in their replies that they were the subsidiary company and Dawn Mills the holding company, that Dawn Mills had 2,500 equity shares of Rs. 100/- each in the petitioners' total equity capital of Rs. 10,000,00/-, and that the Directors of the petitioners had "special attachment to Dawn Mills". He had, therefore, no doubt that the transactions between Dawn Mills and the petitioners were not at arm's length. Since they were not at arm's length and in the ordinary course of business, he ordered that the prices charged by Dawn Mills to their dealers or distributors should be taken as the wholesale cash price wit....

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....wn Mills could not, in the circumstances, form the basis of their assessable value and the assessable value had to be determined on the basis of the price at which Dawn Mills were selling to wholesale dealers. The revision application, accordingly, confirmed the demands made upon the petitioners. 9. This writ petition is filed to assail the orders  aforementioned. 10. My attention has been drawn to the judgment of  the Delhi High Court in Union of India v. Hind Lamps Ltd., Shikohabad, 1981 (6) E.L.T. 11, with which I agree, and which squarely covers this case. Upon the facts there, the court said, it could reasonably be held that there was a special relationship between the buyer and the seller. However, the existence of t....