TMI Blog2015 (12) TMI 670X X X X Extracts X X X X X X X X Extracts X X X X ..... covered by the provisions of Section 4(1)(a) of the Act. This is clearly fallacious and wrong reason. The transaction in question was between the assessee and the distributors. Between them, admittedly, price was charged by the assessee from the distributors. What ultimately distributors did with these goods is extraneous and could not be the relevant consideration to determine the valuation of excisable goods. When we find that price was charged by the assessee from the distributors, the Show Cause Notice is clearly founded on a wrong reason. The case would squarely be covered under the provisions of Section 4(1)(a) of the Act. In view thereof, the Central Excise Rules would not apply in the instant case. - decision dated 10.11.2006 rende ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is filed by the Revenue against the judgment dated 10.11.2006 passed by the CESTAT, West Zonal Bench, Ahmedabad, and the other appeal is filed by the assessee respondent which challenges the judgment dated 27.02.2009 passed by the same West Zone Bench, Ahmedabad of the CESTAT. The dispute pertains to the 'transaction value' that is to be fixed in respect of goods sold by the SPIL to its distributors as physician samples. It is not in dispute that insofar as the assessee is concerned, it is selling these physician samples to its distributors for a price. However, since these are physician samples, the distributors in turn, supplied these samples to the physicians free of cost. Apart from above, the assessee is also selling the go ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tribution. The defence of the assessee was not accepted and the demand in the Show Cause Notice was upheld. This order of the Assessing Authority was affirmed by the Commissioner (Appeals) as well. However, in further appeal to the CESTAT, vide its judgment dated 10.11.2006, CESTAT accepted the plea of the assessee and quashed the demand raised in the Show Cause Notice. Against this order, Revenue is in appeal for which Civil Appeal Nos. 3742-3744 of 2007 is filed. Same kind of Show Cause Notice was issued for different periods wherein Assessing Officer as well as Appellate Authority confirmed the demand contained in the Show Cause Notice. In the appeal filed by the assessee before the CESTAT, the two members of the CESTAT gave confli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e applied. We find that in the Show Cause Notice, the Department has, thus, accepted that no monetary consideration or any other consideration had been received by the assessee or the distributors from a doctor or concerned to whom free distribution of sample packs had been made. Further there was no allegation in the Show Cause Notice that the price at which the goods were sold by the assessee to the distributors was not sole consideration. In fact, the genuineness of the price at which the physician samples were sold by the assessee to the distributors was not even doubted. It is only on the ground that the goods were not actually sold by the distributors to the physicians, which was the ground on which it was contended that the case was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rice-cum-duty, excluding sales tax and other taxes, if any, actually paid, shall be deemed to include the duty payable on such goods. (2) The provisions of this section shall not apply in respect of any excisable goods for which a tariff value has been fixed under sub-section (2) of section 3. (3) For the purpose of this section,- (a) assessee means the person who is liable to pay the duty of excise under this Act and includes his agent; (b) persons shall be deemed to be related if - (i) they are inter-connected undertakings; (ii) they are relatives; (iii) amongst them the buyer is a relative and distributor of the assessee, or a sub-distributor of such distributor; or (iv) they are so ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on such goods. As per the aforesaid provision, it is the transaction value which is to be determined and on which excise duty is payable. As mentioned above, the assessee had put up the defence that since physician samples were not meant for sale by distributors but were to be given free of cost to the physicians, the assessee had charged lesser price. This statement of the assessee had not been doubted. The only reason in the Show Cause Notice given was that since the physician samples were given free of cost by the distributors and no price was charged, the case was not covered by the provisions of Section 4(1)(a) of the Act. This is clearly fallacious and wrong reason. The transaction in question was between the assessee and th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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