K.L. Rekhi, Member (T)

1. The appellants obtained Oxygen Gas as a bye-product in their factory. Compressed Oxygen Gas is chargeable to Central Excise duty under item 14-H of the Tariff. The appellants entered into an agreement with M/s. Rishi Gases (P) Ltd. to sell them compressed Oxygen Gas of 99.5% purity. The sale price for the first year was fixed at 70 paise per cubic metre of the Gas. The appellants sold their entire output of Oxygen Gas to Rishi Gases. Rishi Gases in turn sold the entire Gas to Asiatic Oxygen Acetylene Co. Ltd. @ Rs. 3.25 per m3. M/s. Asiatic sold the Gas, along with their own production, at prices ranging from Rs. 4.665 to Rs. 5.701 per m3. The lower authorities have held that the price of 70 paise per m3, charged by the appellants from Rishi Gases was not a price at arm's length. The Appellate Collector has further held that the sale to Rishi Gases was only a paper transaction. Both the lower authorities have held that the sale price of Asiatic was the correct assessable value in terms of Section 4(1 )(a), Proviso (iii) as it was the wholesale price charged to non-related persons. The Revision Application filed by the appellants against the Appellate