LAWS(CE)-1999-6-198

MODI OLIVETTI LTD. Vs. CCE

Decided On June 09, 1999
MODI OLIVETTI LTD. Appellant
V/S
CCE Respondents

JUDGEMENT

(1.) THESE two appeals are directed against the same order. The issue involved herein is the assessable value of computers manufactured by M/s. Modi Olivetti Ltd. The period of demand is from January, 1991 to March, 1994. For part of the period i.e. from January, 1991 to December, 1991 the goods have been assessed at wholesale price, for the rest of the period goods were assessed based on the retail price. The impugned order holds that there was no genuine wholesale transaction during the first period and therefore, clearances for the entire period had to be assessed based on the retail price. The impugned order has allowed deduction of 9% from the retail price while fixing the assessable value. The order has also allowed deduction on actual basis with regard to expenditure incurred on freight and insurance and duty of excise. The appeal of M/s. Modi Olivetti Ltd. contends that the 9% deduction given is inadequate while the appeal of the Revenue contends that even this deduction is too high. Arguing the appeal of M/s. Modi Olivetti Ltd., learned Advocate Shri V. Sridharan submits that the method of valuation adopted in the impugned order is contrary to law. He submits that when the goods are assessed based on retail price Rule 6 of the Central Excise Valuation Rules is to be followed and the said Rule stipulates that "the value shall be based on the retail price of said goods reduced by such amount as is necessary and reasonable in the opinion of the proper officer to arrive at the price which the assessee would have sold such goods in the course of wholesale trade to a person other than a related person'. The Rule also has a proviso to the that "in determining the amount of deduction, due regard shall be had to the nature of excisable goods, the trade practice in the commodity and other relevant factors". Shri Sridharan also drew our attention to Ministry of Finance instruction F. No. 312/1/75 -CX.10 dated 8.8.1975 which contains instructions as to how to operate Rule 6. These instructions provide as under: - -

(2.) SHRI Sridharan also submitted that the demand is time barred at least for the period from December, 1991 onwards, as price lists had been approved based on full data furnished by the appellants. The assessments for this period was based on the retail price and allegation of suppression of any material facts have not been made for this period.