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2023 (8) TMI 742 - AT - Central ExciseMethod of Valuation - Physician Samples - contention of the department is that the valuation of the impugned goods should have been determined under Rule 4 of the valuation rules, 2000 based on the pro rate value of medicaments sold in the trade and valued under Section 4A - levy of penalty u/r 25 of CER - HELD THAT:- The issue is no more res integra. The Hon,ble Supreme Court has already decided the issue in the case of COMMR. OF CENTRAL EXCISE & CUSTOMS, SURAT VERSUS M/S SUN PHARMACEUTICALS INDS. LTD. & ORS. [2015 (12) TMI 670 - SUPREME COURT], wherein it has been categorically held that valuation of physician samples is to be done as per Section 4(1)(a) of the Central Excise Act, 1944. The Appellant failed to follow the Board Circular dated 25.04.2005, which was available during the relevant period. Subsequently The Hon'ble Bombay High Court also decided the issue in the case of INDIAN DRUGS MANUFACTURER'S ASSOCN. VERSUS UNION OF INDIA [2006 (9) TMI 94 - HIGH COURT, BOMBAY]. Accordingly, by following the decisions of the Hon'ble Apex Court, Bombay High Court and the Board Circulars cited above, We hold that the valuation of physician samples is to be done as per under Rule 4 of the valuation rules, 2000 based on the pro rate value of medicaments sold in the trade and valued under Section 4A. Accordingly, we uphold the demand of duty along with interest confirmed in the impugned order. Levy of penalty - HELD THAT:- There were some contradicting decisions by the Tribunals during the relevant period and confusion prevailed regarding the correct method of valuation to be adoped for payment of duty on physician samples. However, the practice being followed by the Appellant was known to the department. Thus, there was no suppression or violation of any of the provisions of the Act involved and hence, no penalty imposable under Rule 25 of the Central Excise Rules. 2002. The demand of duty along with interest in the impugned order upheld - penalty imposed under Rule 25 of CER, 2002 is set aside - appeal disposed off.
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