UNION OF INDIA & ORS.versusPUROLATOR INDIA LTD.

                              UNION OF INDIA & ORS.
                                                                                    A
                                        v.
                              PUROLATOR INDIA LTD.

                                      MAY 2, 1989

            [SABYASACHI MUKHARJI ANDS. RANGANATHAN, JJ.]                            B

.,J.      .      Central Excises and Salt Act, 1944. Sections 4(J)(a), 4(4)(c)
         "Assessee--Manufacturing and selling filters in the brand name of i<c


-
            customers-Excise duty-Assessment of.

                The respondent company, manufacturer of filters, was selling the
                                                                                    c
          goods to its customers under brand names. It declared its assessable
          value on the basis of the price at which it sold the goods. Show Cause
    ~     Notices, requiring assessable value to be determined at the price the
          buyers of the respondent company sold the goods, issued to the respon-
          dent were challenged by it and quashed by the High Court. Hence this      D
          appeal by the Revenue.

                Dismissing the appeal, this Court

                HELD: 1. For the purposes of the excise duty, the market value
-~        of the goods of the respondent company was the price charged by it, and   E
          not the market value at which the buyers of the respondent company
          sold the goods. The High Court, therefore, rightly quashed the Show
          Cause Notices. [872C]

               The Union of India & Ors. v. Mis Playworld Electronics Pvt.
          Ltd. & Anr., Civil Appeal No. 859of1988 (S.C.) decided on 2nd May,        F
'r        1989,applied.

               CIVIL APPELLATE JURISDICTION: Civil Appeal No. 1491
    ••    (NN) of 1988.

                From the Judgment and Order dated 30.5.1986 of the Delhi High G
                Court in W. No. 578of 1981.
~
              A. Subba Rao,, P. Parmeshwaran and Mrs. Sushma Suri for the
          Appellants.

                H.N. Salve, P.K. Ram and D.N. Misra for the Respondent.             H

                                            871
    872                   SUPREME COURT REPORTS           [1989] 2 S.C.R.

A         The Judgment of the Court was delivered by                            >...
          SABYASACHI MUKHAR.JI, J. This is an appeal by special
    leave and is connected with Civil Appeal'No. 859. This is an appeal
    from the judgment and order of the High Court of Delhi dated 30th
    May, 1986.
B
        It appears that in October, 1975, Trade Notices were issued on
  the basis of the directive of the Ministry of Finance to the effect that-_·


                                                                                        -
  the owners of the brand name are to be treated as the manufacturers of
  the goods. In April, 1977, price list submitted by the respondent
  declaring the assessable value on the basis of the price at which the
C assessee-respondent sold the goods. Thereafter on 16th April, 1977,
  there was a letter written by respondent giving the list of the customers
  of the respondent and clarifying the terms and conditions on which
  the assessee sold the goods. On August 22, 1977, the appellants wrote
  a letter to the assessee-respondent seeking certain information, inter-
  alia, to the effect whether the assessee and its buyers were related
D persons. A reply was given on 10th September, 1977 by the assessee to
  the aforesaid letter. First notice was issued asking the assessee to show
  cause as to why the assessable value be not determined at the price the
  buyers of the assessee sold the goods (instead of the price at which the
  assessee sold the goods to its buyers). There was a reply and the
  second show cause notice was issued on 28th January, 1981. These
E show cause notices were challenged and the High Court quashed the
  said notices. Aggrieved thereby, this appeal has been filed.

       The respondent is a registered company carrying on the business
  of manufacturing and selling filters. Some of the goods are sold by the
  respondent to its customers under the respective brand names. The
F respondent filed a price list at which price the goods were sold to the          ·i
  customers.

        In view of the principles indicated in the judgment in Civil
  Appeal No. 859 and the facts adduced before the High Court, the High
  Court's judgment cannot be interfered. The appeal, therefore, fails
G and is accordingly dismissed.
                                                                                   +
    T.N.A.                                               Appeal dismissed.