By TIOL News Service

ALLAHABAD, JAN 25, 2017: THE appellant a manufacturer of Compact Fluorescent Lamps (C.F.L.) is in appeal against Order-in-Original and Order-in-Appeal whereby it has been held that on bulk sale by them wherein each C.F.L. was marked with MRP, will be liable to be valued for duty under Section 4 of the Central Excise Act, 1944, instead of Section 4A.

During the period 01.4.2001 to 31.8.2004 the appellants sold, in some cases, CFL in bulk to Govt. Departments namely (a) Assistant Garisson Engineer, (b) Central Department of Stores Bamaroli (c) BHEL, and (d) Western Refrigeration (O.E. Manufacturer) and valued the same on MRP basis under Section 4A of the Act and paid the duty on the abated value of MRP. Revenue was of the views that in these cases goods were not sold to ultimate customers in retail but consumed either by them (bulk) or utilised for the manufacturing of other articles and hence are to be assessee u/s4.

The appellant contended that it is admitted fact that CFL bulbs are required to be affixed with MRP and accordingly Central Excise duty is required to be paid under section 4A of the Act. It is also an admitted fact that the bulbs cleared by them were marked with MRP before clearance from the factory. It is further urged that it is not the concern of the appellant as to what the buyer would do after purchase of the CFL from them. It is further admitted fact that neither the MRP mentioned on the retail packs had been crossed out, nor the packs were labelled as 'meant for industrial/institutional use only'.

After hearing both sides, the Tribunal held:

+ The issue is no longer res Integra, as held by the Honourable Supreme Court in the case of Liberty Shoes Ltd and accordingly it is held that there being no dispute that CFL was an item specified under Section 4A of the Act and further MRP was affixed on the products supplied, as such the same would not exempted under Rule 34 of the Rules, read with the provisions of Section 4A of the Central Excise Act, 1944. Further the finding of Commissioner (Appeals) is based on mistake of fact, the impugned order is fit to be set aside. Further it is held that under the facts and circumstances no case of contumacious conduct or suppression is made out and as such extended period of limitation is not available to Revenue. The appeal is allowed and impugned order is set aside.

(See 2017-TIOL-229-CESTAT-ALL)