STANDARD SURFACTANTS LTD Vs. COMMR. OF C. EX.

JUDGEMENT

(1.) THE appellant M/s. Standard Surfactants Ltd., Kanpur are manufacturers of detergent powder and detergent cake which are assessable to Central Excise duty under Chapter 34 of the Central Excise Tariff. The impugned order confirms the following duty demands : -

(2.) THE demand on floor sweepings is on account of the finding that the floor sweeping should be valued at the price of soaps and not at the price at which they were sold. The Collector has held that floor sweepings in question are also usable as soap, and therefore, their appropriate value for assessment to Central Excise duty would be the value of soap. As against this, the appellants have contended that floor sweepings are the sweepings arising from the various raw materials used in the manufacture of soaps and therefore, should not be treated as soap and assessed accordingly. It is also pointed out that the sweepings in question were sold at a much lower price than the price of soaps and thus normal sale price should be treated as assessable value.

(3.) WE are unable to appreciate the basis for assessing floor sweepings at the price of soaps. It is normal that the price of goods vary depending upon their quality and it is common that sweepings would not fetch the same price as the product itself. Even 'seconds' do not fetch the same price as prime quality. The basis for valuation of goods under Section 4(1)(a) of the Central Excise Act is the normal price at which such goods are sold in the wholesale. In the instant case, sales were in wholesale and no material has been shown by the Revenue to hold that the price charged was not normal. In the circumstances, the order demanding duty on floor sweepings has to be held as totally contrary to the provisions of Central Excise law and therefore, illegal. The demand on this score is therefore, set aside.