COMMISSIONER OF CENTRAL EXCISE Vs. DABUR INDIA LTD.

JUDGEMENT

(1.) THE appellants have filed appeals with regard to dutiability of control samples for medicine retained in the factory. The Division Bench which has heard the appellant found that there are conflicting decision on the issue. Accordingly, the matter was placed before the Larger Bench for decision on the issue involved.

(2.) SHRI Kumar. Santosh, learned SDR pleaded that there is no exemption notification for the control samples retained by the appellants in their factory. The samples are therefore chargeable to duty. He further pleaded that as per Rule 9 read with Rule 49 of Central Excise Rules, 1944 excisable goods made in a factory if consumed or utilized - (i) as such or after subjection to any process or (ii) for manufacture of any commodity; whether in a continuous process or otherwise in a factory shall be deemed to have been issued out of, or removed from such factory, immediately before such consumption or utilization. In view of this the control samples shall be deemed to have been removed in terms of Rules 9 and 49 of Central Excise Rules and duty shall be chargeable on such samples. He relied on the following decisions of the Tribunal : -

(3.) HE stated that in the Supplementary Instructions to Excise Manuals effective from 1 -9 -2001, the same position is repeated in Chapter 11 and it is clarified in para 3.3.1 of the said Chapter that where samples are required for the purposes specified at (iii), (iv) and (v) of Para 2.1 above the procedure specified in paragraph 3.2 shall be followed. However it is clarified that when a manufacturer preserve the samples of their product for some period for investigation of complaints, if received, no duty should be charged on these samples considering that goods remain within the factory. Duty shall be charged, unless exempted by a notification, once the samples are cleared from the factory. If at any time the manufacturer desires to destroy these samples, procedure specified in Rule 21 of the said Rules shall be followed.