Judgment

SABYASACHI MUKHARJI, J.:- This is an appeal under Section 35L of the Central Excises and Salt Act, 1944 (hereinafter called the Act). The Superintendent of Central Excise returned the price list of the appellant with a covering letter stating that the price should include all the cost of packing and packing charges in terms of Section 4(4)(d)(i) of the Act.

2. The appellant, a private limited company, manufactured various types of glass bottles which were assessed to duty under Item No. 23A of the Central Excise Tariff. According to the appellant, it sold to the customers on wholesale basis the glass bottles manufactured by it, packed in gunny bags and cartons which it purchases from the market. According to the appellant further, it has been paying duty on the value of the glass bottles including the cost of gunny bags or the cartons in which these are packed at the time of sale. It appears, therefore, according to the appellant, that it has been paying duty on glass bottles on the basis of the assessable value which included the costs of packing material, namely, the gunny bags and the cartons. The case of the appellant further is that the glass bottles are normally sold by it in the packing consisting of gunny bags which are durable and returnable and in several cases the gunny bags are returned by the buyers and are used by the appellant again for packing the glass bottles. It is only when the customers specifically ask for delivery in cartons instead of in gunny bags that the appellant delivered the glass bottles packed in cartons which are also durable and returnable. Towards the end of 1977 and early 1978 the appellant submitted price list in regard to the glass bottles manufactured by it for approval by showing separately the price at which such goods were actually sold in the course of "wholesale trade" and "the cost of packing". By his letter dated 10th January, 1978, the Superintendent of Central Excise returned to the appellant the price lists duly approved but nothing therein that the price should be inclusive of the cost of packing and packing charges in terms of Section 4(4)(d) of the Act. Section 4(4)(d)(i) as it stood read as follows :

"(4) For the purposes of this section :-

(a) assessee means the person who is liable to pay the duty of excise under this Act and includes his agent;

(b) place of removal means-

(i) and (ii) x x x x x

(c) x x x x x

(d) value, in relation to any excisable goods,-

(i) where the goods are delivered at the time of removal in a packed condition, includes the cost of such packing except the cost of the packing which is of a durable nature and is returnable by the buyer to the assessee.

Explanation :- In this sub-clause, packing means the wrapper, container, bobbin, pirn, spool, reel or wrap beam or any other thing in which or on which the excisable goods are wrapped, contained or wound."

3. Since then the appellant has been paying duty on the cost of packing under protest and lodging claims of refund. The appellant, however, did not receive any refund nor any intimation that the claims of refund are or were being rejected. Various representations made by the appellant were in vain. The Assistant Collector of Central Excise wrote a letter dated 8th March, 1980 advising the appellant to file an appeal before the Appellate Collector if the appellant felt aggrieved. Feeling aggrieved, the appellant filed a writ petition under Article 226 of the Constitution in the High Court of Bombay. The High Court passed an interim order on 18th July, 1984 remanding the case back to the Assistant Collector of Central Excise and to decide the matter after giving the appellant fair and adequate opportunity to adduce evidence.

4. After considering the written statements filed by the appellant, the Assistant Collector passed an order on 29th April, 1986 rejecting the appellants refund claim for about Rs. 17 lakhs for the period from 1st January, 1978 to 31st December, 1980 and demanding duty for the period 6t