COMMISSIONER OF C. EX. Vs. PASHUPATI ACRYLON LTD.

JUDGEMENT

(1.) THESE two appeals are at the instance of the Revenue. They challenged the Orders -in -Original passed by the Commissioner of Central Excise, Meerut. Order -in -Original No. 69/95 dated 15 -12 -1995 passed by the Commissioner is under challenge in E/78/97. Following the Order -in -Original No. 69/95, the Commissioner passed Order -in -Original No. 15/96, dated 30 -3 -96. That order is questioned in appeal E/1144/97. In Order -in -original No. 69/95 the period dealt with was from November, 1994 to February 1995. Period from August 94 to October 94 was dealt with in Order -in -original No. 15/96.

(2.) RESPONDENTS in these appeals were manufacturing Acrylic Fibre Tow and Top. They were selling their produce at different prices to dealers in wholesale sale. On the basis of the price realised from the dealers they paid excise duty under Section 4(1)(a) of the Central Excise Act. Department took the view that the manufacturer was giving discount at different rates to different buyers, though the price of finished goods to be the same for each and every buyer. Department was of the further opinion that discount was being given by the assessee without any regard to the quantum of goods sold to the dealer, remoteness, proximity of the buyers from the factory and prompt payment. It was also seen that discount had not been given to all the buyers. Further it was revealed that the same dealer was not being given discount on all occasions. The rates of discount suddenly increased for a period from 27 -12 -1994 to November 1995 for most of the buyers. This was raised after introduction of ad valorem rate of duty in place of specific rate of duty. The Department was of the view that discount was not given in accordance with the normal practice of wholesale trade in terms of Section 4(4)(d)(ii) of the Central Excise and Salt Act, 1944. Hence show cause notices were issued demanding differential duty payable by the assessee. The manufacturer -assessee disputed the claim made in the show cause notices contending that the prices realised was sole consideration for the sale, that there was no relationship between the assessee and the dealer/purchaser and that there was no flow back of money over and above the price charged and realised.

(3.) AFTER considering the rival contentions the Commissioner observed -