SACI excise appeal allowed

LEGAL DIGEST

The Supreme Court has allowed the appeal of SACI Allied Products Ltd against the order of the Customs Excise & Gold (Control) Appellate Tribunal which had held that the company was liable to excise duty on the basis of the sale price to its dealers in Uttar Pradesh and not based on its sale price to independent dealers outside the state.

The company, which makes detergents, sold the product to dealers throughout the country. There was no dispute regarding the duty on these sales.

However, it also sold detergents in the state to Syndet & Chemical Industries Ltd (owner of the trade mark 'Fena') at a price which was lower.

Syndet, in turn, sold the goods to its dealers in Uttar Pradesh price which was higher than the price at which SACI sold the product outside the state.

According to SACI, it has paid excise duty for sales made to Syndeet also at the price charged by it from independent dealers situated all across the country.

The collector of excise passed an order stating that Syndet is a related entity and, therefore, in view of Section 4(1)(a) of the Central Excise Act, excise duty was to be paid by thee company based on the price at which the goods were resold by Syndet to its dealers in the state. The tribunal upheld this view. However, the Supreme Court reversed the ruling.

Packing charges not part of glassware value

The Supreme Court has dismissed the appeal of the collector of Central Excise, Kolkata, against the order of Cegat in favour of Hindustan National Glass and Industries Ltd.

The main issue was whether packing charges realised by the company from its customers in different situations for different types of packing would form part of the assessable value of the final product or not to attract duty under the Central Excise Act.

The company is engaged in the manufacture of various types of glass bottles for milk, soft drinks, medicines and the like. The bottles manufactured by the company are used by other manufacturers of consumer products for packing their goods.

Sometimes the bottles are delivered in a loose packaging, sometimes the buyers want their goods to be packed in some sort of packing for safe transport.

In some other cases, the buyers send their own packing materials like gunny bags. Cegat held that the packing charges collected by the assessee company were not includible in the assessable value of glassware. The Supreme Court upheld this view.

HC ruling on mining lands quashed

The Supreme Court has stated that the mining lands taken over from private owners under the Coal Mines (Nationalisation) Act 1973 belonged to the government and were vested in the Coal Mines Authority Ltd, a government company.

The executive authorities cannot give pieces of such land to private individuals, the court said while setting aside the judgment of the Gauhati High Court in North Eastern Coalfields Ltd versus Mubarak Ali.

In this case, the deputy commissioner gave land to a private hospital, which was challenged by the coal company. The high court approved of it, but the Supreme Court quashed it.