I.J. Rao, Members (T)

1. These two appeals, involving common question of facts and law were heard together and are being decided together. The appellants, stated to be a limited company, manufacture, inter alia, rickshaw and taxi meters. They appointed M/s. Anand Traders, a partnership concern as their distributors throughout India. The appellants also directly sell their meters to Industrial consumers like Bajaj Auto Limited. Shri U.V. Vaidya, Managing Director of Diamond Clock Manufacturing Co. Pvt. Ltd. thereinafter referred to as Diamond holds about 12% of shares in Diamond and 75% interest in Anand Traders. Shri Vaidya's mother holds nearly 25% of interest in Anand Traders and about 48% shares of Diamond. The sale pattern of Diamond is that 70% of their production is sold to Anand Traders and 30% to others. The prices charged by Diamond to Anand Traders are, on an average, about 9.17% less than the prices to others.

2. The Collector of Central Excise issued a show cause notice to the appellants threatening to cancel the concession of assessment on invoice price under Notification 120/75-CE, which was granted to them and proposing assessment of the goods under S. 4 of the CE