1. Referred as a Revision Application before the Government of India, Ministry of Finance, Department of Revenue the same now stands transferred to this Tribunal to be heard as an appeal.
2. The brief facts of the case are that M/s. Facit Asia Limited, Madras are the manufacturers of the typewriters falling under Tariff Item 33-D of Central Excise Tariff Schedule. These typerwriters are marketed through their distributors namely (1) Forbes and Forbes Limited, Bombay (2) Continental Commercial Co. Ltd., Calcutta (3) Ciciko Office Machines, Calcutta and (4) Saradha Latham Business Machines Ltd., Madras. The issues which require determination in this case are (i) whether or not the four distributors at Bombay, Calcutta and Madras through whom the appellants route their sales of these typewriters manufactured by them are 'related persons' of the appellants and (ii) which of the two sets of prices viz. the price at which the appellants sell their products to the distributors or the different prices at which the distributors sell the product in turn would constitute the assessable value.
3. Both the authorities below held that these four distributors are the related persons of the appellants and that the assessable value would be actual price at which each of his related person resell the typewriters.
4. We have heard Shri M. Chandrasekharan, Advocate assisted by Sh.
Sridharan, C.A. for the appellants and Shri G.V. Naik, J.C.D.R. for tie department and gone through the record.
5. Learned counsel for the appellants submitted that the present appeal is on all fours, on the point of law and broad facts, as Appeal No.157/79-A which was decided by this Bench of the Tribunal vide order No.256/85-A reported as 1985-(21)-E.L.T.-711. According to the learned counsel, the issue in the present appeal, stands concluded between the appellants and the Revenue and the present appeal also deserves to be allowed, as was the earlier appeal.
6. Shri Naik, learned J.C.D.R. submitted that applying the ratio of the Supreme Court Judgment reported at 1983 E.L.T. 1896 (S.C.) in the case of Union of India and Ors. etc. v. Bombay Tyres International and Ors.
etc. etc., the appellants should be treated as persons related to their distributors. He did not elucidate this point further except submitting that these distributors perform several functions such as advertisement, after sales service, supply of spare parts etc. which clearly the appellants could have done themselves. According to Shri Naik, this is sufficient material to show that the appellants have a special relation with the distributors and there is mutuality of interest between the appellants and the said distributors.
7. Notification No. 120/75-C.E. which is relevant notification, contemplates inter alia that exemption shall be available only if the invoice price is not influenced by any commercial, financial or other relationship whether by contract or otherwise other than the relationship created by sale of any goods. In the present case, there is no evidence to show that the concessional or lower prices were charged by the appellants on account of any extra commercial considerations. It is seen that the lower authorities have held the appellant's distributors as related persons for the purpose of Central Excises Act for the reason that they perform certain functions in relation to the goods after their purchase from the appellants. It has not been brought out on record as to how an invoice price is influenced by any commercial, financial or any other relations. Performance of any function in relation to the goods for marketing the same or any after sales service to the consumers or dealers by the distributors by itself does not create any commercial, financial or other relationship. There have been authoritative pronouncements as to how the term related person has to be interpreted as set out under Section 4 of the Central Excises and Salt Act, 1944. The Supreme Court in the case of Union of India v. Atic Industries Limited 1984 (17) E.L.T. 323 (S.C.) have dealt with this issue in great depth. The matter has not been examined by the lower authorities in the light of this pronouncement, and it is desirable and in the interest of justice full facts are examined as to the nature of relationship between the appellants and their buyers in the light of this judgment. In view of the above, we set aside the order of the lower authorities and remand the case to the concerned Assistant Collector for de novo consideration. The Assistant Collector shall decide the case as early as possible but not later than six months from the date of the receipt of this order as the matter is an old one.