COMMISSIONER OF CENTRAL EXCISE, MEERUT-I versus BISLERI INTERNATIONAL PVT.LTD.

Citation: [2005] SUPP. 1 S.C.R. 841 · Decided: 27-07-2005 · Supreme Court of India · Bench: B.P. SINGH · Disposal: Dismissed

Judgment (excerpt)

COMMISSIONER OF CENTRAL EXCISE, MEERUT-I 
v. 
A 
BISLERI INTERNATIONAL PVT.LTD. 
JULY 27, 2005 
[B.P. SINGH AND S.H. KAPADIA, JJ.] 
B 
Central Excise Act, 1944/Central Excise (Valuation ) Rules, 1975-
Section 41 Rules 5-Aerated water-Assessable Value of-Whether includes 
amounts received as 'price support incentive' and 'rent on containers'-
Held: The amounts received is not includible in the assessable value of the C 
aerated water-Jn the facts of the case no extra commercial considerations 
have entered the transaction-The levy of rent on containers did not form 
price of the aerated water. 
Respondent-Assessee was manufacturer of aerated water. It obtained the 
concentrate (raw-material) from a Company, used to bottle the same and sold D 
to the wholesale dealers. Assessee used to collect rent on containers from 
some of the dealers and it also used to receive price support incentives from 
the raw material supplier. 
The question for consideration in the case was whether the cost of rent 
on containers and the value of price support incentive were liable to be included E 
in the assessable value in terms of Rule 5 of Central Excise (Valuation) Rules, 
1975. Dismissing the appeal, the Court 
HELD: 1. Under Section 4 of Central Excise Act, 1944, as it stood at 
the material time, price is adopted as a measure or a yardstick for assessing F 
the tax. The said measure or yardstick is not conclusive of the nature of the 
tax. Under section 4, price and sale are related concepts. The "value" of the 
excisable article has to be computed with reference to the price charged by 
the manufacturer, the computation being made in accordance with section 4. 
In every case, it will be for the Revenue to determine on evidence-whether the 
transaction is one where extra-commercial considerations have entered and, G 
if so, what should be the price to be taken into account as the value of the 
excisable article for the purpose of excise duty; (845-G, H; 846-AJ 
Union of India and Ors. v. Bombay Tyre International ltd. etc., AIR 
(1984) SC 420, relied on. 
841 
H 
842 
SUPREME COURT REPORTS [2005] SUPP. 1 S.C.R. 
'' 
A 
2. There is no evidence of flow back of any additional consideration from 
the buyers of aerated water (beverage) to the assessee. On account of cut-
throat competition from another Company, the Company which used to supply 
raw material to the assessee, had to provide incentive to the assessee. On the 
other hand, the evidence on record indicates that price uniformity was 
B maintained. No favour for extra commercial reasons was shown to any of the 
buyers of aerated water. There is no evidence of any concession to any of the 
buyers. There is no evidence of existence of any favoured buyers. In the 
circumstances, Rule 5 of Central Excise (Valuation) Rules, 1975 is not 
applicable. [846-D, E] 
C 
3. So far as rent on containers is concerned, the rent equivalent to 
interest was collected by the assessee on account of delay in returning of 
empty crates/bottles. The purpose of charging interest was to get back empty 
bottles/crates immediately as otherwise the assessee was required to make 
additional investment towards stock inventory on crates/empty bottles. Further, 
the said levy did not form the price of the aerated water and, therefore, ROC 
D was not includible in the assessable value. [846-F, G] 
E 
Collector of Central Excise v. Jndian Oxygen, (1988) 36 ELT 730, relied 
on. 
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 772 of200 I. 
From the Judgment and Order dated 5.11.99 of the Central Excise, Customs 
and Gold (Control) Appellate Tribunal, New Delhi in F.O. No. 1558/99-A. No. 
E/2438/98-A. 
WITH 
F 
C.A. Nos. 769, 770, 771, 1403-1404/2001, 6765/2002, 120, 1763, 5215-5219/ 
2004 and 672 of2005. 
Rajiv Dutta, Add. Solicitor General, Shalini Kumar, Ravindra Agarwal, P. 
Parmeswaran, B.K. Prasad and S.N. Terdol with him for the Appellant. 
G 
Dushyant Dave, V. Lakshmi Kumaran, M.P. Devnath, Alok Yadav, Rajesh 
Kumar, Maninder Singh, Pratibha M. Singh, Kirtiman Singh, Abhinav Mukerji, 
Pradeep Jain, Ms. Hetu Arora, Rupesh Kumar, Neelam Sharma, T.C. Shanna, 
B.V. Desai, Vinay Yaish, Hitender Mehta, Amit Awasthi, Sanjeev K. Singh, 
Pradeep K. Malik, Sheenam Parwands, Ms. Meenakshi Arora, Mis. Aruptham 
H Aruna & Co. and V. Balachandran with him for the Respondents. 
C.C.E. v. BISLERI INTERNATIONAL PVT. LTD. [KAPADIA, J.] 
843 
~. 
The Judgment of the Court was delivered by 
A 
KAPADIA, J. A short question wh

Excerpt shown. Read the full judgment & AI analysis in Lexace.