TMI Blog1992 (3) TMI 175X X X X Extracts X X X X X X X X Extracts X X X X ..... sidiary of Hindustan Lever Ltd., Bombay for manufacture on its behalf two brands of Soaps, namely Sunlight and Lifebuoy. Indexport issued an authorisation under Notification No. 305/77 dated 5-11-1977. All the materials required for manufacture of the said soaps were supplied to the appellants by Indexport and the appellants received processing charges for conversion of raw materials into finished goods at a specified rate per unit of production. In terms of the agreement entered into between the appellant and Indexport, the price at which the goods will be sold by Indexport is the basis for the determination of the assessable value for the levy of excise duty. 4. The appellants filed price lists claiming the following deductions : 1. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ay and claim refund and the freight from the wholesale depots to various other areas to which the supplier of the raw material sent the goods. 7. The department has come up in appeal against the order of the Collector allowing the claim of the appellants regarding the handling expenses and the remuneration paid to the clearing agents and the forwarding agents. 8. At the outset, we may make it clear that the issue is actually covered by the judgment of the Supreme Court in Ujagar Prints case [1988 (38) E.L.T 535 (S.C.) ] as the supplier of raw material is Indexport, and therefore, the price declared by the Indexport plus the profit of the appellant and the job work charges should be the assessable value. However, the appellants have not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ration paid to the clearing agents, forwarding agents. The reply to the show cause notice stated that it is paid on account of handling, storage, despatch and other services rendered by them in the course of transportation of finished goods after removal from the factory gate till they are delivered to the wholesale dealers. Admittedly, the expense is incurred after the removal of goods from the factory gate. In U.O.I. v Duphar Inter-Pan Ltd., 1987 (27) E.L.T. 599 (S.C.) the Supreme Court is of the view that extra charge incurred outside the factory gate is not includible in the assessable value. Therefore, the Collector is right in allowing these deductions. The judgment of the Supreme Court in Coromandal Fertilisers v. U. O.I. - 1984 (17) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y sold in the market. The outer special packing in the form of corrugated boxes is being provided by us to protect the finished goods from damage during the course of their transportation from the factory gate till delivery to the wholesale buyers . 16. It is true that if the corrugated boxes are only meant for safe transportation, then in view of the judgment of the Supreme Court in Godfrey Philips - 1985 (22) E.L.T. 306 (S.C.) , the cost of corrugated boxes is excludible from the assessable value. However, neither the Asstt. Collector nor the Collector considered whether the corrugated boxes are necessary for putting the soaps in the condition in which they are generally sold in the wholesale market at the factory gate or they are only ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of damage in each case is admissible. It is also a case of damage caused to the goods during transit. Following the above order, we direct the A.C. to verify the nature and quantum of discount for damage caused to the goods in the transit and allow the same. 20. The next item of dispute is the turnover tax paid by the appellants. The Collector directed that the appellants should pay the tax and claim refund. The observation of the Collector is quite contrary to the observations of the Supreme Court in Bombay Tyre International [1984 (17) E.L.T. 329 (S.C.),. According to the Supreme Court, turnover tax should be allowed to be deducted from the sale price in order to arrive at the assessable value and also octroi where payable/paid by the m ..... X X X X Extracts X X X X X X X X Extracts X X X X
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