The assessable value for excise duty should be fixed at the price sold to retail dealers, and quantitative discounts should be allowed only for clearances where the discounts were actually given.

RAMANUJAM J

The petitioner-firm is a manufacturer of domestic electrical appliances, particularly, water heaters of various sizes. On 1-3-1969, excise duty was introduced on domestic electric appliances. The petitioner submitted a price list on 7-3-1969, as required under the Central Excises and Salt Act, 1944 and the Rule made thereunder for approval of the assessable value to the first respondent. At that time the petitioner was having two sets of prices, one applicable to bulk purchasers and another applicable to retail dealers who purchased small quantities. Messrs Philips India Ltd., is the only concern which was buying in large quantities while others were buying in small quantities. The first respondent, however, discarded both the sets of prices and gave a provisional approval on 8-3-1969 at the prices at which Messrs Philips India Ltd. sold the water heaters to small dealers who purchased from them in small quantities. On 26-8-1969, however, the first respondent gave a final approval under Sec. 4(a) accepting the set of prices given by the petitioners applicable to retail dealers. In that letter it was stated that the sale to small retail dealers can be considered as taking place under open market conditions under Sec. 4 (a). As regards the price sold to Philips India Ltd., the first respondent has stated in the said letter that Philips India Ltd., was a favoured buyer and that there cannot be more than one set of prices for excise purposes. Against the said order dated 26-8-1969, of the first respondent, the petitioner preferred an appeal to the second respondent on 26-8-1969.

2.Again on 12-9-1969, the petitioner gave a new price list. The first respondent approved the said price list applicable to retail dealers on 17-8-1969, after rejecting the set of prices applicable to wholesale dealers on the ground that there cannot be more than one set of price for excise purposes. As against the said order also the petitioner filed an appeal to the second respondent on 25-2-1970.

3.Because of the difference in assessable value as per the provisional approval of the prices dated 8-3-1969 and the final approval dated 26-8-1969, the petitioner made a claim for rebate of the excess amount paid for the clearance during the period 8-3-1969 and 28-8-1969, which came to about Rs. 5, 000/-. However, on 3-1-1970, the first respondentsuo motuissued an order modifying his own final price approval dated 26-8-1969 refixing the assessable price at the set of prices at which Messrs Philips India Ltd. sold the water heaters to small dealers who purchased from them in small quantities. This modification has been made effective from 8-3-1969, the date of the first provisional approval. The first respondent by another order dated 8-1-1970 stated that order dated 3-1-1970, modified also the earlier order dated 17-8-1969. The petitioner preferred an appeal to the second respondent on 26-2-1970, as against the said two orders dated 3-1-1970 and 8-1-1970.

4.On 17-1-1970, the petitioner wrote to the first respondent pointing out that Messrs Philips India Ltd. had already stopped dealing in water heaters and that the last purchase by them was on 14-11-1969 and requesting for refixation of the assessable value on the prices the petitioner sold to the wholesale dealers who buy from them. On 19-1-1970, the first respondent gave a provisional price approval again on the set of prices to the retail dealers who buy small quantities from the petitioner.

5.Towards the end of April, 1970 the petitioner decided to increase the price of water heaters for the first time after the introduction of the excise duty. They offered three sets of prices (1) applicable to small dealers who buy less than 100 pieces in a year or less than 20 pieces at a time; (2) applicable to dealers who buy more than 100 pieces but less than 400 pieces in a year or more than 20 pieces at a time; and (3) applicable to dealers who buy more than 400 pieces in a year or more than 40 p