TMI Blog1994 (8) TMI 34X X X X Extracts X X X X X X X X Extracts X X X X ..... decide the issues involved on their merits. - 7591 of 1993 - - - Dated:- 8-8-1994 - M.N. Venkatachaliah, CJI and S. Mohan, J. [Judgment per : S. Mohan, J.]. - This is an appeal under Section 35L of the Central Excises and Salt Act, 1944 (hereinafter referred to as the Act) directed against the order of Customs, Central Excise and Gold (Control) Tribunal (hereinafter referred to as CEGAT) dated 30th September, 1993 in Final Order No. 500/93-A in Appeal No. E/2407/91-A. In and by the said order the Tribunal allowed the review/appeal filed by the Excise Department and set aside the order of the Collector of Central Excise dated 30th May, 1990 and remitted the matter for a fresh decision. 2. The facts are as under : The appellant, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent and publicity expenses and testing expenses incurred by Colgate Palmolive could not possibly be included in the assessable value of the appellant's products. It was also pointed out and submitted that there was no warrant at all to invoke the longer period of limitation under the proviso to Section 11A of the Act. On March 19, 1990, the Collector afforded the appellant a personal hearing. The appellant submitted detailed written submissions on all points raised in the show cause notice. 3. The Collector rendered the following finding : "The department has not disputed the fact that M/s. MGS manufacture the goods in their own factory and have all the infrastructure for the said manufacturing activity. It is also not the case of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an that is the condition regarding how M/s. MGS will procure the raw material and in the event of goods failing to be of the specifications the manner of disposal thereof. It is clear that MGS have been manufacturing goods on their own account from raw material purchased by them from the market. The goods to be supplied have to be as per specifications enclosed with the order. The buyer (M/s. CP) will be entitled to reject the goods in case they are not upto the specifications. From these conditions, it is clear that neither M/s. MGS is a hired labour of M/s. CP nor are they a front company of CP. The right of rejection of goods by CP clearly establishes that the M/s. CP and M/s. MGS are two separate entities and the transaction of sale and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... /s.CP I find force in the arguments advanced by the learned counsel. Since the testing charges incurred by M/s. CP in their laboratory after purchase from M/s. MGS have no nexus to the manufacture and sale of the products by M/s. MGS I hold that these charges cannot be taken into account in determining the assessable value and for demanding duty from M/s. MGS." Similarly, concerning the loss incurred by the appellant, he found in favour of the appellant. In this view, he did not consider it necessary to render a finding regarding the allegation of suppression of facts. In fine, the proceedings initiated by show cause notice dated 3rd July, 1989 were dropped. Aggrieved by this, the matter was taken up in appeal to CEGAT. The Tribunal, afte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t materials were before the Tribunal. To characterise the order of the Collector as laconic is not correct since he has written a detailed order including reference to the relevant case law. Thus, it is prayed, the order may be set aside and the Tribunal itself may be directed to decide the matter. 6. Opposing the stand of the appellant, the Department argues that the Collector has misdirected himself by merely referring to the two letters dated 17-1-1985 and 2-5-1985. That was why the Tribunal referred to the revealing paragraphs. At least, the letters ought to have been analysed in the proper perspective. Equally, the other findings as to testing charges and the loss. Therefore, the remit was fully warranted. 7. Having regard to the c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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