P.C. Jain, Member (T)

1. Brief facts of the case in so far material are as follows :-

The appellant had been submitting price lists of various goods manufactured by it under Rule 173-C of the Central Excise Rules (hereinafter referred to as the Rules) from time to time during the period 15.3.73 to 30.9.75. These price lists had not included, as per declaration on the reverse of these price lists, the cost of secondary special packing and delivery charges recovered by the appellant company from its customers. On submission of the price lists the appellant company had been clearing the goods on payment of duty on the basis of its declared assessable value i.e. without including the cost of special secondary packing and delivery charges declared by it on the reverse of the price lists. The appellant company had also been submitting R.T. 12s during this period.

Neither the price lists were approved by the Department nor were any assessments made on R.T. 12 by the proper officer till a show cause notice was issued on 3rd July, 1976 asking the appellant company as to why the charges recovered by it from its customers towards packing and delivery be not included in the value of the foods and why differential duty be not demanded under Rule 10-A of the Rules.

2. Learned advocate for the appellant company has made the following submissions :-

(1) The question of correct assessable value of the goods manufactured by the appellant company has already been decided by the High Court of Allahabad in its judgement dated 14.5.1974. The writ petition filed in the said High Court was allowed by it with costs and the Hon'ble High Court held that the price declared by the appellant company in its price lists was the assessable value of the appellant company's products for the purposes of duty of central excise and that the transaction between the appellant company and its customers were at arms length. The learned advocate has submitted that even though the question in the said writ petition was whether the price charged by the appellant company from its customers was to form the basis of assessable value (as contended by the appellant company in its writ petition) or whether the prices charged by the customer companies was to form the basis of the assessable value (as contended by the Department), the Department is now estopped from raising this plea of including the packing and delivery charges in the value of the excisable goods in analogous to the principles under Explanation IV to Section 11 of Civil Procedure Code (CPC) (Act V of 1908). Plea of Explanation IV to Section 11 of CPC is the plea of constructive res-judicata inasmuch as, the learned advocate for the appellant asserts, that the Department might and ought to have stated in its defence before the High Court of Allahabad that the value of the excisable goods in any case should have had included the packing and delivery charges recovered by the appellant company from its customer companies in case the latter's contention of basing the value of the goods on the prices of the customer companies is no upheld. In its support the learned advocate for the appellant has relied upon Supreme Court's judgement reported in MANU/SC/0032/1977 : AIR 1977 SC 1680, apart from some earlier judgements of Privy Council and Supreme Court.

(2) Next plea of the learned counsel for the appellants is that demand is time barred in terms of the provisions of Rule 10 read with Rule 173-3. Elaborating this plea the learned advocate has submitted that the appellant company had been submitting its price lists with full declaration of facts to the Department. It had also been clearing the goods and submitting R.T. 12s. The Department did not raise any objection to the clearance of goods till the issue of a letter dated 20.1.1976 by the Superintendent of Central Excise referring to the aforesaid 16 price lists and stating for the first time that those price lists had been approved after including the cost of packin