R.N. Pyne, J. - (1.) This appeal, which is directed against a judgment and order dated September 27, 1974 of Masud, J. involves mainly questions regarding determination of 'value' under Section 4(a) of the Central Excises and Salt Act, 1944 (hereinafter referred to as "the Act"), interpretation and scope of the said Section as also the Notifications dated September 1, 1962 and November 26, 1966.
(2.) Since 1962 the appellant (the petitioner in court of the first instance) has been manufacturing diverse types of 'Cellulose Acetate Moulding Granules' (hereinafter referred to as 'the said goods') used in the manufacture of plastic- end products which are excisable under item 15-A of the Central Excise Tariff. During the period relevant to this appeal the Appellant sold and still sells the said goods,'all over the country to various customers and dealers at an uniform price fixed by the appellant from time to time. According to the appellant it granted and still grants long term credit facilities to about 90 days to its various dealers in Bombay, Calcutta and Delhi to whom commission was also paid @ Rs. 410/- per ton. In allowing such commission and fixing the prices various expenses or charges such as interest on long credit, transport charges, freight, insurance, handling charges, storage charges and godown charges were and are included in the selling costs and selling profits because they relate to post-manu- facturing operation. Before May 11, 1968, the date of introduction of the 'Self Removal Scheme', assessment of duty used to be made on physical control basis according to which the assessing officer in each case after being satisfied with the selling price allowed clearance upon production of evidence of pay- ment of the duty payable to the Collector of Central Excise, Calcutta and Orissa Collectorate. After the introduction of the 'Self Removal Procedure' the appellant had been filing with the appropriate Excise Officer for his verification list of goods manufactured by the appellant in various statutory form out or forms prescribed by the Collector of Central Excise showing the prices of the said goods.
(3.) The Government of India, Ministry of Finance, in exercise of the powers under R. 8(1) of the Central Excise Rules, 1944 issued the Notification No. 166/62-Central Excise, dated September 1, 1962. The said notification is set out hereunder :- "GSR. In exercise of the powers conferred by Sub-rule (1) of Rule 8 of the Central Excise Rules, 1944, as in force in India and applied to the State of Pondicherry, the Central Government exempts with effect from the 1st September, 1962 'Plastics, all sorts' falling under item 15A of the First Schedule to the Central Excises and Salt Act, 1944 (1 of 1944), in respect of which the list fixing the price at which they would be sold to the consumers is available, from so much of the duty of excise leviable thereon as is in excess of 20% of the value calculated after allowing a discount of 12.5% on the price specified in the said list : Provided that the procedure of assessment elected by the manufacturer shall apply uniformly to all the 'Plastics, all sorts' cleared by him : Provided further that the aforesaid exemption shall be admissible only if the list of price referred to above represents the prices at which the 'Plastics, all sorts' are ordinarily sold to consumers.";