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2016 (3) TMI 436 - CESTAT NEW DELHI

2016 (3) TMI 436 - CESTAT NEW DELHI - 2016 (344) E.L.T. 356 (Tri. - Del.) - Valuation of chewing tobacco - Section 4 or Section 4A - multiple packing / bulk packing - pouches of 6 gms. and 7 gms. - These are then packed in multiples of 52/42/40/32 pouches in a plastic bag and are cleared on sale. - Held that - the CBEC vide their Circular dated 28/2/2002 (para 7) clarified that in case of doubt in situation like this, the matter should be got clarified by the concerned Department of State Govern .....

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1 of 2013 - Final Order No. 50895-50896/2016 - Dated:- 19-2-2016 - SHRI S.K. MOHANTY, MEMBER (JUDICIAL) AND SHRI B. RAVICHANDRAN, MEMBER (TECHNICAL) For the Respondent : Ms. Neha Garg, Authorized Representative (DR) For the Respondent : Shri K.S. Gupta, Consultant ORDER PER. B. RAVICHANDRAN :- These are two appeals filed by the Revenue are involving interconnected matters and hence, taken up for disposal together. Appeal No. E/1840 of 2007 deals with valuation of chewing tobacco manufactured and .....

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ic bag and are cleared on sale. It is the case of the Revenue that since the small pouches containing 6 gms. and 7 gms. are together put in a bigger pouches, the entire product should be considered as multi-piece packages covered by the MRP Regulations in terms of Standards of Weights & Measures (Packaged Commodity) Rules, 1977. Accordingly, proceedings were initiated against the respondent resulting in the order-in-original dated 26/12/2005 by the Original Authority. The Original Authorit .....

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are not governed by the SWM Rules in view of the exemption under Rule 34 of the said Rules. Aggrieved by this, the Revenue filed appeal before us. 3. Based on the above favourable order of the learned Commissioner (Appeals), the respondent filed a refund claim for ₹ 73,97,158/-. The claim was rejected by the Original Authority. On appeal, the learned Commissioner (Appeals) vide his order dated 3/5/2013 allowed the appeal with consequential relief. He observed that the Original Authority ha .....

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us. 4. In the grounds of appeal in respect of both the appeals the Revenue mainly contended (a) chewing tobacco manufactured and cleared by the respondent are correctly assessable in terms of Section 4A of the Central Excise Act with reference to the retail sale price. The exemption contained in Rule 34 of SWM Rules not applicable to the impugned goods as they are neither sold by weight nor by measure. They are sold in numbers. (b) Reliance was placed on the definition of multi piece package. .....

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al relating to refund, the grounds of appeal by the Revenue is totally misplaced and not on the facts of the case. The appeal is not valid on this ground alone. On merit, regarding valuation of the impugned goods, the respondents submissions are as follows:- (a) The Chewing Tobacco manufactured by the respondent are put in pouches of below 10 gms. And many such pouches are put in wholesale package and cleared for sale. The package containing many small pouches are not intended for retail sale b .....

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ule 34 (b) of SWM Rules; (c) The allegation of Revenue that many small pouches are put together to form a multi piece package intended for retail sale is not factually correct. Apart from not producing any evidence to support the allegation, the Department has not considered the clarifications given by various State Legal Metrology Departments who are the administrators of SWM Act under the Rules. The CBEC vide Circular dated 28/2/2002 has specifically laid down that in case of doubt the clarifi .....

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ackage containing 10 or more retail packages, being wholesale package need not carry retail sale price declaration thereon. (d) Reliance was placed on various decided cases by the Tribunal and the Honble Supreme Court in support of their contention. 6. We have heard both the sides and examined appeal records. The point for decision is the correct provision applicable for valuation of chewing tobacco manufactured and cleared by the respondent/assessee whether to be assessed in terms of Section 4 .....

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NT) dated 01/3/2003. We find that in the impugned order, the Commissioner (Appeals) examined this issue and held that these are not multi piece packages but are wholesale packages. He examined the question on both the ground that (a) whether the small pouches are retail packages, (b) when more than 10 retail packages are in a larger pouch are they wholesale packages. Relying on the interpretation and clarification given by the Metrology Authorities of the State Government he held that the impugn .....

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rounds now being agitated before us and we find no reason to interfere with the above findings of the learned Commissioner (Appeals). 7. We find that the Tribunal in CCE, Rohtak vs. Gupta Tobacco Co. reported in 2010 (252) E.L.T. 271 (Tri. - Del.), while examining similar set of facts held that the goods packed in pouches and put in bulk packs are only weighing less than 10 gms. and hence are not governed by SWM Act and the Rules. They are outside the purview of Section 4A. The Honble Supreme C .....

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