COMMISSIONER OF CENTRAL EXCISE Vs. BARON INTERNATIONAL LTD.

JUDGEMENT

(1.) Respondent (BIL) is a distributor of AKAI products & purchased "AKAI" brand Colour TV Sets manufactured in India on job work basis from manufacturers including M/s. J.R. Electronics. (JRE). An investigation was carried out wherein it was claimed before the IO that there existed a provision for payment of 18% interest on all the loans and advances made to JRE by BIL. The investigating officer found that for the financial year 1994-95, the accrual of such interest had not been shown in the books of Respondent.

(2.) On the basis of these facts, 4 SCN's dated 12-6-97, 29-7-97, 31-7-97 & 8-10-97 were issued to the Respondents alleging that JRE was not an independent job unit but was a dummy of the Respondent created and nurtured with the single motive that cost of manufacture be reduced by bifurcation and the cost of sale promotion, advertisements, after sales services etc. were incurred by the Respondent company.

(3.) Adjudicating Authority vide its order in original dated 27-1-1999 held that the project report could not be called a device to reduce the burden of duty since at the time when the project report was prepared by the Respondents, the CTV's attracted specific rate of duty. The price at which JRE sold goods were comparable to the prices charged by other manufacturers similarly placed for identical goods i.e. Uptron etc.