9911796707
TMI Blog2016 (7) TMI 298X X X X Extracts X X X X X X X X Extracts X X X X ..... r Government agencies for supply of the medicaments at an agreed upon price, in response to the tenders floated by the State Government agencies. The medicaments required to be supply by the said appellant were to be clearly marked as Govt. supply only, not for sale. The appellant supplied a part of the goods directly to the Government departments at the agreed upon price and discharged their duty liability accordingly. However, as per the investigation made by the Directorate General of Central Excise Intelligence, the appellants were also routing the said movement of the medicines, through their intermediaries M/s Anupam Distributors (hereinafter referred to as M/s Anupam) as also through M/s S.S. Pharma. The supplies made to the said intermediaries were at a lower price than agreed upon between the appellant manufacturer with the Government department in terms of the rate contract entered between the two. The said intermediaries further raised invoices to various Government hospitals and sold the goods at the agreed upon prices. 3. Revenue entertained a view that such medicaments manufactured by M/s BDIL were meant for direct supply to various Government hospitals at the agreed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... between the two, adopted as assessable value cannot be held to be not in accordance with law and as such the duty stands correctly paid by them on the said transaction value in terms of the provisions of Section 4 of the Central Excise Act. Detailing their arguments, it stands pleaded that in terms of the general practice in the medicine industries, the tenders are always filed in the name of the manufacturer as the Government agencies do not enter into contracts with the distributor or other person. The goods are however sold to the distributors, who further sell the goods to such Government agencies. In such a scenario, the manufacturer gets the payment immediately from the distributor who, after sale of the medicines to various Government agencies, collect the payments thereafter. As such it stand contended before us that the sale between M/s Anupam and the manufacturer has to be considered as a transaction on principal to principal basis and in the absence of any allegation that the transaction value is not the only consideration received by the manufacturer, the ingredients of Section 4(1)(a) of the Central Excise Act stands satisfied, thus making no room for any differential ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... adopted by the manufacturer to evade payment of duty. We have already observed that M/s Anupam cannot be held to be having a status of distributor, the appellants-contention of adopting the transaction value between the two in terms of the provision of Section 4(1)(a), has no weightage inasmuch as Section 4(1)(a) would not be applicable in such a scenario, the transaction being not on principal to principal basis. The fact that the goods stands supplied directly by the manufacturer and it is only the invoices which are initially being raised by them in the name of M/s Anupam, who are further raising the invoices in the name of the Government hospital is indicative of the cleverly adopting the fictitious route by the manufacturer. Even if viewed from another angle, the part of the goods which stand directly supplied by the manufacturer to the Government hospital having been assessed at the contracted price, a part of the goods in respect of the same very contract cannot be allowed to be assessed on a different assessable value merely because the appellant have roped in an intermediary agency in between. As such we find no infirmity in the views adopted by the authorities below and h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l adjudicating authority by observing that the initial contract awarded to M/s BDIL was inclusive of duty and as such the subsequent amount collected by the assessee by way of supplementary / additional bills was on account of excise duty collected but not deposited. He accordingly confirmed the demand. On appeal against the said part of the lower authorities, Commissioner (Appeals) extended the benefit by observing as under: "9. As far as the demand of duty under Section 11D of the Act is concerned, I find that the same is not sustainable on account of the following facts: a) The invoices for collecting the differential amount on account of revision of prices has been issued only by M/s Anupam Distributors and not by the Appellant No. 1. In all these invoices there is no clear indication to show that the amounts collected represent excise duty only. b) As the contract with the Govt. Departments is an all inclusive price, any revision of price cannot be attributed to excise duty element alone when it is a fact that the duty payable at the time of clearance has been paid correctly by Appellant No. 1 (i.e. after Budget of 1999 & 2000). c) The revision of prices had bee ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
