PURE DRINKS LTD. Vs. COMMISSIONER OF CENTRAL EXCISE

JUDGEMENT

(1.) SINCE the points involved in these matters are common, they are disposed of together at the instance of both sides.

(2.) THE appellant M/s. Pure Drinks Ltd. is engaged in the manufacture of aerated water falling under Chapter Heading No. 22.01/22.02 of the Central Excise Tariff Act, 1985. The appellant owns units, at Connaught Place, Motinagar and Okhla under a common management. The excisable goods were first transferred to these units or to the duty paid godown of the appellant and later sold from there in the course of wholesale trade. The invoices raised from these places for sale revealed collection of certain rental charges and transport charges for the delivery to the buyers, which were not included in the assessable value. Undisputedly, different units to which stocks were transferred belonged to the same entity.

(3.) IT was submitted on behalf of the appellant that the entire charge in the matter was based on the footing that three units of the appellant were different persons related to each other and that proviso to Section 4(1)(a)(iii) was wrongly invoked. Under Section 4(1)(a)(iii), where the assessee so arranges that the goods are generally not sold by him in the course of wholesale trade except to or through a related person, the normal price of the goods sold by the assessee to or through such related person shall be deemed to be the price at which they are ordinarily sold by the related person in the course of wholesale trade at the time of removal to dealers (not being related persons) or where such goods are not sold to such dealers, to dealers (being related persons), who sell such goods in retail. The assumption in the Order -in -original that three units of the appellant located at different places were related persons appears to be erroneous because admittedly all the three units belonged to the appellant and no other person natural or juristic was involved to bring about any relationship between persons as contemplated by the provision of Sub -clause (iii) of Section 4(1)(a) of the Act, as was applicable at the relevant time.