Per A.C.C. Unni :

In these two appeals, common issue has been raised for consideration. They were, therefore, heard together and are being disposed of by this common order.

2. We have heard Shri V. Lakshmi Kumaran, learned Advocate for the appellants and Shri Prabhat Kumar, learned Senior Departmental Representative appearing for the respondent Collector.

3. Appellants are engaged in the manufacture of heavy and sophisticated Electrical & Electronics equipments and machinery which are designed as per the specific requirements of the customers. The terms and conditions of sale also contain a condition relating to warranty which provides for replacement of the items if they developed defects within a period of 12 months from the date of commissioning or 18 months from the date of despatch, whichever is earlier. An amount of 2.5% of the factory cost is set apart by the appellants as 'complaint reserve' in the contractual price entered into by them. The Central Excise duty is paid by the appellants on the total contract sale value. Where in terms of the warranty clause the appellants supply replacements to their customers, appellants do not discharge any further duty since, according