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1985 (11) TMI 55 - SC - Central ExciseWhether the medicinal preparation is capable of being consumed as ordinary alcoholic beverage or not and not whether it is in semi-solid or liquid form? Whether in determining the value of the medicinal preparations for the purpose of levying excise duty thereon the authorities erred in taking the wholesale price of the said preparations and not the price at which these preparations were supplied by the said firm to their chief distributor Messrs M.B. Bhavsar & Sons? Held that:- These preparations were patent or proprietary medicines which contained alcohol and it was undisputed that such preparations were not capable of being consumed as ordinary alcoholic beverages. The High Court was, therefore, right in holding that these medicinal preparations were dutiable under Item 1. Both these firms had their offices in the same premises and under the partnership agreement the sons of the original First Appellant and the other two Appellants were to share only in the profits of Messrs M.B. Bhavsar & Sons but not to be liable for any losses. These two firms, therefore, cannot be said to be at arm's length or independent parties and the prices at which the medicinal preparations were supplied by Bhavsar Chemical Works to Messrs M.B. Bhavsar & Sons cannot be taken to be the real value of the said preparations. The High Court was, therefore, right in rejecting this contention also. Appeal dismissed.
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