COLLECTOR OF CENTRAL EXCISE Vs. TIDE INDUSTRIES

JUDGEMENT

(1.) BRIEFLY stated facts of this case are as follows : -

(2.) THE aforesaid contentions as made in the show cause notices originally issued to the respondents have been reiterated in the present appeal of Revenue. It is contended by the learned JDR for the Revenue that the respondents herein were selling the entire product to RCI. Following provisions under the Manufacturing and Marketing Agreement were relied upon by Revenue : -

(3.) WE have carefully considered the pleas advanced from both sides. We observe that on the same facts and circumstances show cause notices issued against the respondents for the period prior to the period in question before us as also for the subsequent period have all been dropped by the department. We do not find any reason that the Collector of Central Excise should take a different in filing these appeals before the Tribunal. Nevertheless, we have gone through the impugned order and we find the same to have reached the correct conclusion in respect of both the main allegations, as mentioned above. It cannot be held on the basis of the agreement in question that RCI is the manufacturer on whose behalf the goods have been manufactured by the respondents. It also cannot be held that the prices at which the goods were sold by the respondents to RCI, in any way, was influenced by considerations other than the normal commercial ones. The agreement between the RCI and the respondents, on the face of the terms as expressed therein is an agreement between [two] principals. The reliance placed by the appellant -Collector on Tribunal's judgment in the cases listed above do not help the Revenue. There is no indication whatsoever either from the terms of the contract or by any other evidence available on record that the RCI has received any extra payment for supplying technical know -how to the respondents herein which has led to the manufacture of the goods. In the case of Intercon Engineering and in the case of TIL Ltd. drawing and designing charges were being collected separately by the assesses therein under a broad heading "consultancy charges". No separate break -up had been given for those consultancy charges. In those circumstances the consultancy charges collected separately by the assessees in those cases were added to the value of the goods manufactured by them. There is no such separate collection being made by the respondents which can be added to the price of the goods received by them from RCI.