TMI Blog2017 (10) TMI 276X X X X Extracts X X X X X X X X Extracts X X X X ..... f Central Excise duty in terms of Section 4 (1) (a) of CEA, 1944. Rule 8 can be resorted to for valuation only when the transaction is not of sale. In the facts of the present case, the possession of the goods and ownership stands transferred from the respondents to M/s.Aquagel Chemicals Pvt. Ltd. Gujarat and M/s.Sree Rayalaseema Alkalis and Allied Chemicals Ltd. Andhra Pradesh, in respect of sale of soap noodles. The SCN only made a charge that transaction is not of a sale, which is absolutely incorrect on the face of the evidences. Appeal dismissed - decided against Revenue. - E/2539/06 - A/89720/17/EB - Dated:- 26-9-2017 - Mr. Ramesh Nair, Member (Judicial) And Mr. Raju, Member (Technical) Shri.N.N. Prabhudesai, Supdt. (AR) for appellant Shri.Mansi, Patil, Advocate for respondent ORDER Per: Ramesh Nair 1. The fact of the case is that the appellant, M/s.Hindustan Lever Ltd., manufactured Breeze/Lux Soap Noodles falling under Chapter sub-heading No.3401.19 of the schedule to the CETA, 1985 and cleared it to M/s.Aquagel Chemicals Pvt. Ltd. Gujarat and M/s.Sree Rayalaseema Alkalis and Allied Chemicals Ltd. Andhra Pradesh on payment of Central Excis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ollowing judgements: a) ITC Ltd - 2014 (36) STR 481 (Del) b) Mahalaxmi Fabrics Mills Pvt. Ltd. - 2016 (339) ELT 427 (Tri-Ahmd) c) Indorama Synthetics (I) Ltd - 2015 (323) ELT 20 (SC) d) IFGL Refractories Ltd. - 2005 (186) ELT 529 (SC) 3. Ms.Mansi Patil, Ld. Counsel appearing on behalf of the respondent submits that the respondent have sold the goods to two companies, M/s.Aquagel Chemicals Pvt. Ltd. Gujarat and M/s.Sree Rayalaseema Alkalis and Allied Chemicals Ltd. Andhra Pradesh, on principle to principle basis, by raising sale invoices and charging sales tax. Merely, because the recipients of the goods have manufactured branded soap on behalf of the respondents, the nature of sale will not get altered. She submits that there are two transactions involved. One sale of noodles by the respondents to said two companies and sale of branded soap by those companies to the respondent. She placed sample copies of the invoices. She further submits that the agreement referred by the department in their grounds of appeal is not a sale agreement but it is a sourcing agreement particularly for the purpose of manufacture and supply of branded soap by the said two c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Chemicals Pvt. Ltd. Gujarat and M/s.Sree Rayalaseema Alkalis and Allied Chemicals Ltd. Andhra Pradesh to the respondents. Accordingly, it cannot be said that these transactions are not a sale transaction in the ordinary course of trade. This be so, the transaction value has to be taken for charging of Central Excise duty in terms of Section 4 (1) (a) of Central Excise Act, 1944. Rule 8 can be resorted to for valuation only when the transaction is not of sale. In the facts of the present case, the possession of the goods and ownership stands transferred from the respondents to M/s.Aquagel Chemicals Pvt. Ltd. Gujarat and M/s.Sree Rayalaseema Alkalis and Allied Chemicals Ltd. Andhra Pradesh, in respect of sale of soap noodles. The show-cause notice only made a charge that transaction is not of a sale, which is absolutely incorrect on the face of the evidences as referred above. On perusal of the impugned order, we find that the Ld. Commissioner (Appeals) has given an elaborated findings, which is reproduced below: I have carefully gone through the facts of the case on record, submissions made and contentions put forth at the time of personal hearing. The issue before me to be deci ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and purchase stand satisfied in as much as that there is a transfer of ownership of the property from appellant to the manufacturers. In case of Video Master Vs. CCE - 1996 (88) ELT 117 the tribunal has held that even the transfer of goods on security deposit, for the long period of rent, where the deposit was almost equivalent to the value of the goods and the goods were not returned after the rent paid was over, the transaction to be in the nature of sales, as per the definition of sale as given in the Central Excise Act. The matter of the present case are even at better footing than the one cited above. In as much as that while transferring the possession of the goods the monitory consideration is duty indicated whereas in case referred above there was not even a whisper of the value of consideration. Further in the case of Collector, Central Excise, Vs. Modern Food Industries - 1988 (37) ELT 294 CEGAT observed as under: 7. We have carefully considered the facts of the case and the submissions made before us. As per the order in appeal the transaction between the manufacturer and the branches cannot be considered as sale because it is mere transfer of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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