TMI Blog1987 (9) TMI 194X X X X Extracts X X X X X X X X Extracts X X X X ..... hould be disallowed for the purpose of determining the assessable value of the goods in terms of Section 4 of the Central Excises and Salt Act, 1944. 2. The period of controversy is from 25-4-1983 to 30-11-1983. The appellants filed a price list in Part I in which they claimed deduction of 27.5% discount allowed to J.B.A.Co. The department approved the same. Later, on 17-11-1983, the department came to know that there was an agreement between the appellants and J.B.A.Co. according to which J.B.A.Co. was to organise sales promotions, marketing, distribution and other services on behalf of the appellants. Thereupon, the department issued a show cause Notice on 14-12-1983 proposing to disallow the discount of 27.5%. On adjudication, the Ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ding whose order the department wants to be restored. The respondents stated that both the appellants as well as J.B.A.Co. were separate limited companies and neither of them had any share holding in the other. Possibly sensing the weakness of this ground, it was not really pressed before us during the hearing. The ground which was really pressed for by the learned representative of the department was the second ground, i.e., that the relationship between the appellants and J.B.A.Co. was that of a principal and agent. In this connection, objection was taken by the learned representative of the department in respect of the following features of the agreement between the two :- (i) J.B.A.Co. was to maintain adequate show rooms, sales staff ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to Clause 11 of the agreement. The fourth item of the agreement regarding sales promotion by J.B.A.Co. at its own cost did not, by itself, turn J.B.A.Co. into an agent of the appellants. On the contrary, we find that Clause 4 of the agreement stipulated that J.B.A.Co. was to purchase the appellants products as an independent principal and sell them as such . Further, Clause 5(a) of the agreement permitted J.B.A.Co. and their dealers to sell the appellants goods on prices even lower than the listed prices published by the appellants. The agreement shows that the relationship between the appellants and the J.B.A.Co. was that of a seller and buyer. J.B.A.Co. was to pay for the goods and on payment the property in goods passed on to J.B.A.Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed to disallow the entire 27.5% discount but only to add the money value of the additional consideration for the sale. The legal position that cost of advertisement and publicity is includible in the assessable value of the goods has been stated clearly in the judgment of the Hon ble Supreme Court in the case of Bombay Tyres International Limited [1983 E.L.T. (14) 1896 (S.C.) - Para 49]. 6. No other point was pressed before us by either side. 7. In the circumstances, we set aside the impugned order of the Collector (Appeals) and allow this appeal in terms that the Assistant Collector shall determine the money value of the additional consideration for the sale, add only that much to the assessable value of the goods and revise the demand ..... X X X X Extracts X X X X X X X X Extracts X X X X
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