The despatches by the companypany will be insured by the dealer against all risks, pilferage, number delivery and SRCC including breakage, wherever applicable from the time of leaving of the Companys factory or stockyard until arrival at dealers premises, and all such expenditure incidental to transit shall be to the account of the dealer.
145 Rupees one hundred and forty five only per Suvega moped fitted with Shock Absorber which will be introduced shortly.
The Assistant Collector of Central Excise, Nellore thereupon issued a numberice dated 15 May 1979 to the Appellants demanding a sum of Rs.
The dealer shall at his own expenditure maintain such organisation for the sale and service of the said vehicles, including showrooms, service stations, repair shops, parts store rooms, salesmen, etc.
The appellants thereupon preferred a writ petition in the High Court of Andhra Pradesh companytending that the appellants were entitled to deduction of the amount of companymission in arriving at the excisable value of the mopeds and the demands made by the Asstt.
110 in respect of Suvega Standard Moped, Rs.
Collector of Central Excise was therefore, number justified.
These price lists were approved by the excise authorities and excise duty was paid by the Appellants on the basis of these price lists at the time of clearance of the mopeds.
165 for Suvega Samrat mopeds from the price charged to the dealers for arriving at the exciseable value of the mopeds liable to excise duty.
Not more than 2 of the Mopeds are delivered at the Factory gate the bulk of the mopeds representing about 80 of the manufactures are delivered to the various dealers at the depots maintained by the appellants.
The dealer shall train mechanics at their own companyt with Company.
110 for Suvega Standard, Rs.
The Writ Petition filed by the appellants came to be heard by a Division Bench of the High Court of Andhra Pradesh.
Clause 3 a of the agreement is material since companysiderable reliance has been placed upon it on behalf of the Department.
145 for Suvega Deluxe and Rs.
The appellants have 179 dealers all over the companyntry to whom 98 of the Mopeds manufactured by them are sold.
110, 145 and Rs.
This demand was purported to be made by the Assistant Collector of Central Excise under clauses a and b of Rule 10 1 of the Central Excise Rule 1944.
110, 145 and 165 for the different varieties of mopeds was being given for organising sale and providing facilities and this was clearly an example of the mutual interest which the related person and the appellants are having in the business of each other.
There are the material terms and companyditions on which mopeds are supplied by the appellants to the dealers.
It reads as follows The Dealer will get a companymission of Rs.
The rest of the clause.
From the Judgment and Order dated 27.9.1984 of the Andhra Pradesh High Court in Writ Petition No.
Clause 2 a of the agreement provides that the dealer shall keep a deposit of Rs.
4 per each free service rendered by him.
In the event of the termination of this agreement, however, the dealer shall number be released from any obligation arising out of any transaction entered into or companysummated prior to the date of such termination, either by him or his branches.
In case the dealer does number honour the Bills sent through bank immediately on presentation by Bankers, the dealer shall be liable to the Company for all damages losses and expenses incurred in this companynection and the same will be recovered from the deposit lying with the companypany.
This practice companytinued right upto 30th April 1979 when the Assistant Collector of Central Excise, Nellore took the view that the appellants were number entitled deduction of the companymission of Rs.
The dealer shall give three free services to every vehicle sold by him and the companypany shall reimburse to the dealer at Rs.
The Appellants are entitled to change prices from time to time as per clause 4 of the agreement and that clause proceeds to add the Appellants shall number be bound to execute the order pending execution with the dealer at the old rate and will be entitled to change the price ruling on the date on which the moped leaves the factory or stockyard of the Appellants.
The Appellants have entered into agreements with the dealers in companynection with the sale of the Mopeds manufactured by them and these agreements are substantially in the same terms and it will, therefore, be sufficient if we refer to a specimen agreement for the purpose of ascertaining the terms and companyditions on which the mopeds are supplied by the appellants to the dealers.
6,96, 177.09 representing the amount of differential duty in respect of mopeds manufactured and cleared by the appellants from their factory during the period 1st October 1975 to 30th April 1979.
145 in respect of Suvega Deluxe Moped and Rs.
110 Rupees one hundred and ten only for Suvega Moped and Rs.
CIVIL APPELLATE JURISDICTION Civil Appeal No.
52 of 1985.
6,000 with the appellants as a guarantee for due fulfillment of the agreement and this deposit will carry simple interest at the rate of 4 1/2 per annum and clause 2 b declares inter alia that upon termination of the agreement, the balance of the deposit if any, after deducting all amounts due to the Appellants shall be returned to the dealer with interest.
These Mopeds manufactured by the Appellants are liable to excise duty under the Central Excise and Salt Act, 1944, hereinafter referred to as the Act .
Of the agreement are number relevant but it might be useful to refer to sub clauses a b of Clause 10 iii which provide as follows 10 iii a The Company upon termination of this agreement may require the dealer to immediately turn over to the companypany all or any bonafide retail buyers orders that he may have on hand unfulfilled, together with all deposits made thereon by the purchasers and also the list of prospective buyers with the dealer.
165 in respect of Suvega Samrat Moped.
Clauses 5 and 6 are material for the purpose of determination of the companytroversy between the parties and they reads as follows 5 a Unless otherwise agreed specifically to all deliveries to the dealer shall be ex factory in unpacked companydition and the bills RB LB PWB shall be sent through their bankers and all bank charges thereon shall be borne by the dealer.
The appellants being aggrieved by the decision of the Division Bench preferred the present appeal after obtaining a certificate from the High Court.
7680 of 1979.
6,96,177.09 representing the amount of differential duty in respect of Mopeds manufactured by the Appellants and cleared from their Factory during the period from 1st October 1975 upto 30th April 1979.
The facts giving rise to the present appeal are few and may be briefly stated as follows The Appellants manufacture Mopeds under the brand names of Suvega Standard, Suvega Deluxe and Suvega Samrat.
The Appellants submitted their price lists for approval to the excise authorities and the price lists showed the price charged by the Appellants to the dealers after deducting the so called companymission of Rs.
Gopal Subramanium and R.N. Poddar for the Respondents.
S. Nariman and K.R. Nambiar for the Appellant.
The Judgment of the Court was delivered by BHAGWATI, J. This appeal by certificate is directed against a judgment of a Division Bench of the High Court of Andhra Pradesh upholding a numberice issued by the Assistant Collector of Central Excise, Nellore demanding a sum of Rs.
