TMI Blog1988 (2) TMI 209X X X X Extracts X X X X X X X X Extracts X X X X ..... mon issue involved in these 11 matters relates to determination of assessable value of the glassware manufactured by the appellants. The appellants manufactured glass tumblers and glass chimneys in numerous sizes and designs. During 1979-83, they sold a part of their production ex-factory and stock transferred the rest to their depots situated at Calcutta, Delhi, Bombay, Ernakulam, Madras, Vijayawada, Bangalore and Hyderabad. The stock so transferred was sold from these depots. In the price lists, which they filed for approval of the Assistant Collector, the appellants declared their ex-factory sale prices. On verification of their sale invoices, the department found that the ex-depot sale prices were much higher (by 35% to 117%) than the d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s that quantum of goods sold at the factory was not material and that the factory sale value, whenever available at the factory gate, should be the assessable value in respect of all the goods cleared from the factory, whether on direct sale from the factory gate or on stock transfer to the depots. 4. The department s plea in their appeals is that insertion of the word ordinarily in the new Section 4(1 )(a) has made all the difference and, therefore, the ratio of the Voltas case judgment of the Supreme Court, which was under the old Section 4, no longer holds good. The department s prayer is that ordinarily meant majority sales and, therefore, wherever majority of the sales of a particular variety took place from the depots, the price ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... factory or from certain depots. Further, glassware was a commodity in which breakages were quite common in handling and transport. Their factory was located in the interior of Orissa State. The distant customers did not want to take the risk of breakages in getting their goods direct from the factory. They preferred to buy from the depot nearest to them. The depot, in addition, could supply the varieties in small lots as per the customer s requirement. Finally, another consideration which weighed with the customers was that if they purchased the goods from the depot located within the State, they saved on the central sales tax. It is for these commercial reasons that no uniform pattern was observed in the sales of their various varieties. B ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Particulars (Amount in Rs.) Description of goods 8 oz. Narrow A 1. Assessable value declared per gross Rs. 88.00 2. Packing charges per gross Rs. 10.00 3. Total assessable value claimed Rs. 98.00 4. Central-Excise duty @ 20% ad valorem Rs. 19.60 5. Special Excise duty @ 5% of basic Rs. 0.98 6. Total price at Factory gate Rs.118.58 7. Gross selling price at depot Rs.123.50 8. Trade discount given to buyers @ 8% Rs. 9.88 9. Net price received BREAK UP of price received as in item 9 above. Rs.113.62 10. Total price ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it which they made at Vijayawada and Bangalore only offset their losses incurred elsewhere. It is quite apparent to us that the lower authorities fell in error by comparing two unequal prices, one net ex-factory price and the other gross depot price. So far as the data placed before us by the appellants is concerned, it was not countered by the department. The calculations in the one particular instance reproduced by us in paragraph 6 above would show that the incidental depot expenses loaded by the appellants are not far-fetched. Indeed, quite a few of the depot expenses have been held to be deductible from the depot sale price by the Supreme Court in their judgment in the case of MRF Limited 198 (27) E.L.T. 553 (S.C.)]. We are sure that i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... percentage of ex-factory sales as compared to the depot sales is not entirely irrelevant. But, at the same time, the percentages alone cannot be the decisive factor. All the relevant facts and circumstances of the case would have to be looked into to see whether a genuine ex-factory sale price existed. In the present case, as already stated by us, the appellants were selling certain varieties of their goods entirely or almost entirely at the factory gate. They were selling a major part of certain other varieties also at the factory gate. As to which of their varieties would be sold at the factory, and in what proportion, was determined by the commercial factors of supply and demand. They have given sound commercial reasons which would have ..... X X X X Extracts X X X X X X X X Extracts X X X X
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