TMI Blog2016 (4) TMI 288X X X X Extracts X X X X X X X X Extracts X X X X ..... terial placed, it cannot be concluded that the appellant has succeeded in establishing that such an arrangement of return of the packing materials of the gunny bags with the obligation on the part of the seller to refund the value thereof existed between the parties. Also, obligation taken by the appellant to refund the value of the gunny bags to the Buyer in terms of any arrangement between the parties not found. - Value to be included - Decided against the assessee. - Civil Appeal Nos. 7251-7302 of 2000 - - - Dated:- 1-4-2016 - Ranjan Gogoi, Arun Mishra And Prafulla C. Pant, JJ. For the Appellant : Mr. Ravinder Narain, Adv. Ms. Mallika Joshi, Adv. Ms. Ruchika, Adv. Mr. Rajan Narain,Adv. For the Respondent : Mr. K. Radhakris ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re concerned, it was noted by the Tribunal, that these belonged to the appellant but their cost was realised from the customer along with the cost of glass bottles. The appellant s case was that these packings were also returnable and in many cases they were actually returned and reused by the appellant. There was no evidence about the durability of the cartons and gunny bags but nothing to show that these were returnable. The position seems to be as follows: The Tribunal has rightly applied the returnability test. In K. Radha Krishnaiah v. Inspector of Central Excise this Court observed that it cannot be said that the packing is returnable by the buyer to the assessee unless there is an arrangement between them that it shall be returned. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for nothing. In those circumstances, the Tribunal held that the cartons and gunny bags were not returnable in the accepted sense of the term. The Tribunal further noted that since the statute insisted on the packing being returnable, in addition to being durable, the authorities are bound to see whether the transaction fulfilled the tests of returnability as per the Supreme Court and High Court judgments. 3. Paragraphs 12 and 17 of the judgment in Triveni Glass Ltd. (supra) may also be noted : 12. Reliance is also placed upon the case of Mahalakshmi Glass Works (P) Ltd. v. CCE wherein it has been held that under Section 4(4)(d)(i) of the Act the cost of packing which is of durable and returnable nature is to be excluded. It is h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ooden crates are durable and returnable packing whose cost is not to be included in the value of glass sheets. 4. From the above what transpires is that if an arrangement exists between the seller and the buyer of excisable goods for return of the packing materials by the buyer to the seller, carrying an obligation on the seller to return the value of the packing materials to the buyer on such return, such value is not liable to be included in the assessable value of the finished product. Furthermore, if such an arrangement exists, the question of actual return is not relevant. 5. The materials placed before us do not enable us to come to the conclusion that the appellant has succeeded in establishing, on the basis of the materials ..... X X X X Extracts X X X X X X X X Extracts X X X X
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