TMI Blog2016 (1) TMI 590X X X X Extracts X X X X X X X X Extracts X X X X ..... s a packaged commodity, they are required to be cleared on retail sale price on the packages as per the provisions of Section 4A, the assessment shall be on MRP basis. - Decision of Apex Court in Jeyanthi Food Processing Pvt. Ltd. [2007 (8) TMI 3 - Supreme Court] followed. In the present case, the appellants have been clearing the goods when the MRP assessment came into existence from 2008 onwards. Therefore, the department suddenly choose to change the assessment from MRP based to transaction value from 10.05.2012 only to the goods sales made to the brand owners is not justified and particularly when the revenue itself accepted the assessment based on MRP under Notification No. 49/2008 from 24.12.2008, on the same transaction to the actual users. - demand set aside - Decided in favor of assessee. - C/MISC/40882/2015 & C/41789/2014, C/41927/2015 & C/41928/2015 - FINAL ORDER No. 41772 - 41774 / 2015 - Dated:- 10-12-2015 - Shri R. Periasami, Technical Member And Shri P.K. Choudhary, Judicial Member For the Petitioner : Shri S. Jaikumar, Adv. For the Respondent : Shri Veerabhadra Reddy, JC (AR) ORDER Per: R. Periasami The appellant filed miscellaneous a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pellant preferred appeal before the Commissioner (Appeals). The Commissioner (Appeals) in his impugned order upheld the adjudication order and rejected the appeals. Hence the present appeals. 3. The Ld. Advocate Shri S. Jayakumar, submitted a written synopsis, case laws and reiterated the same and submits that they are regular importer of LCD/LED Monitors and Television sets of various sizes and there is no dispute on the classification of LCD/LED monitors. He submits that the monitors were sold to the customers under three modes viz. a) sale to the brand owner where the monitors are affixed with the brand name of HCL, Wipro etc., b) sell under their own brand name (AOC) and c) sell as non-branded goods. They regularly import monitors and initially CVD was paid as per the transaction value and in 2008 the monitors were notified under Section 4A to be assessed under MRP based and Section 3 (2) of CTA also amended to assess CVD as per RSP in terms of Section 4A read with Legal Metrological Act, 2009 (LMA). The impugned goods were assessed and abatement of 20% was allowed as per the Notification No. 49/2008 dated 24.12.2008 and the department had accepted the above assessment under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4. CC, Chennai Vs. Micro Labs. Ltd.-2010 (251) ELT 317 He drew attention to the Hon ble Supreme Court Judgment in the case of Jayanthi Food Processing Pvt. Ltd. (supra) and submitted that the Hon ble Supreme Court has held that once the goods are covered under LMA and Rules made there under, the valuation of such goods should be on the basis of retail sale price of such goods. The nature of sale is not relevant for application of Section 4A. 5. On the other hand, the Ld. AR reiterates the findings of the impugned order and the adjudication order, he drew attention to Section 3 (2) (b) of CTA which empowers levy of CVD on the goods imported based on the MRP based assessment under Section 4A of CEA. He further submits that the monitors are supplied to HCL and Wipro as actual users who used the monitors for manufacture of PC s. The appellant as per the pre-determined arrangement imported these monitors for sale to the actual users only, and the said goods are not intended for retail sale. He refers the definition of retail sale , where the goods are ultimately sold in retail sale. Whereas, in this case, HCL and Wipro are used monitors for their manufacture of computers. He ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... does not have any retrospective effect. There was a definition already existed in LM Act in respect of dealers and manufacturers prior to amendment and Rule 2 (bb) under LM Act was specifically amended to include importer and the wholesale dealer . This confirms that for earlier period only manufacturers were covered under Rule 3 and under Rule 2 (bb) and the customs cannot interpret the LM Act by differently changing the definition. 8. We have carefully considered the submissions of both the sides and perused the records. The short issue before us is whether the assessment of imported monitors LCD/LED is under Section 3(2) (b) read with Section 4A under MRP basis or under normal transaction value for the purpose of CVD. The period involved in this case relates to 10.05.2005 to 08.02.2013. As per Notification No. 24/2004-Cus dated 01.03.2005, the appellants were eligible for NIL rate of duty of BCD on LCD monitors and they availed the said exemption. We also find that the appellants have been regularly importing the said items prior to 2003 and clearing the goods on payment of CVD as per the transaction value. Subsequently the LCD monitors were brought under MRP based asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s meant for industrial consumers or institutional consumers. Explanation- For the purpose of this rule,- (i) institutional consumer means the institutional consumers like Transportation, Airways Railways, Hotels, Hospitals or any other service institutions who buy packaged commodities directly from the manufacturer for use by that institution (ii) industrial consumer means the industrial consumer who buy packaged commodities directly for the manufacturer for use by that industry. Rule 2 bb- w.e.f. 6.6.2013 Industrial consumer means any institution which hires or avails of the facilities or service in connection with transport, hotels, hospitals or such other service institutions which buy packaged commodities directly from the manufacturer for use by that institution. Rule 2 bb- w.e.f. 14.5.2015 Industrial consumer means the consumer who buys packaged commodities directly from the manufacturer or from an importer or from wholesale dealer for use by that industry and the package shall have declaration not for retail sale . From the above definition of Rule 3, industrial consumer means only the consumer who buys packaged commodities d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r Rules made thereunder or under any other law to declare on the package of the goods the retail sale price of such goods for being covered by the Section, it would be better to see the various provisions of the said Act and the Rules made thereunder. Section 83 of the SWM Act empowers the Central Government to make Rules on the subjects provided in Section 83(2). Accordingly, the Central Government framed the Rules called The Standards of Weights and Measures (Packaged Commodities) Rules, 1977 . As would be suggestive from the title itself, Rule 1(3) provided that these Rules would apply to the commodities in packaged form which are, or are intended or likely to be sold, distributed, delivered or offered or displayed for sale, distribution or delivery, or stored for sale or for distribution or delivery in the course of inter-State trade and commerce. Definition of retail dealer under Rule 2(o) is as under : retail dealer in relation to any commodity in packaged form means a dealer who directly sells such packages to the consumer and includes, in relation to such packages as are sold directly to the consumer, a wholesale dealer who makes such direct sale. Defi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uch commodity to the consumer in smaller quantities; or (iii) packages containing ten or more than ten retail packages provided that the retail packages are labeled as required under the rules. Chapter II of these Rules is applicable to the packages intended for retail sale. Rule 3 provides that the expression package wherever occurring in the Chapter shall be construed as packages intended for retails sale . Rule 6(1) provides for the declaration to be made on every package and sub-rule (f) thereof is as under : (f) the retail sale price of the package Rules 15 and 16 pertain to the declarations required to be made on combination packages and group packages. A glance at these rules suggests that the sale price is required to be mentioned on both. Rule 17 deal with multi-pieces packages also requiring to declare the sale price on the same. Rule 23(1) and (2) provide as under : 23. Provisions relating to wholesale dealer and retail dealer (1) No wholesale dealer or retail dealer shall sell, distribute, deliver, display or store for sale any commodity in the packaged form unless the package complies within all respects, the provisions of the Act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the goods when the MRP assessment came into existence from 2008 onwards. Therefore, the department suddenly choose to change the assessment from MRP based to transaction value from 10.05.2012 only to the goods sales made to the brand owners is not justified and particularly when the revenue itself accepted the assessment based on MRP under Notification No. 49/2008 from 24.12.2008, on the same transaction to the actual users. By respectfully following the Tribunal s decision and the Hon ble Apex Court s decision (supra), we hold that the monitors with brand name meant for sale to brand owners are eligible for assessment under Section 3 (2) (b) of Customs Act read with Section 4A of CEA and the notification issued there under MRP/RSP based assessment and eligible for abatement as per the notification. Accordingly, the impugned orders demanding differential duty is liable to be set aside. Since the main demand is set aside, the question of imposing penalty does not arise. Accordingly, in respect of appeals No. C/41927/2015 No. C/41928/2015 penalty is set aside. All the three appeals are allowed with consequential relief. (Dictated and pronounced in open court) - - TaxTMI - T ..... X X X X Extracts X X X X X X X X Extracts X X X X
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