Case Law Details
Bilag Industries P. Ltd. Vs Commr. of Cen. Exc. Daman & Anr. (Supreme Court of India)
Who can be said to be related person u/s 4(4)(c) of the Central Excise Act, 1944 to enable the authorities to discard the transaction value and arrive at a valuation otherwise?
The Supreme Court in this decision considered the definition as contained in Section 4(4)(c) as per which in order that two persons can be said to be related to each other, there must be interest of two persons (said to be related ), directly or indirectly in the business of each other. Thus the buyer and seller must have interest in each other’s business before the provision of Section 4(4)(c) could be applied. There should not be one way traffic whereas requirement is that of two way traffic.
What is of importance is certain interdependence and reciprocity beyond the relationship of either a distributor or manufacturer so as to consider as to whether the parties are ‘related persons’.
Decisions relied upon by the learned counsel : Union of India & Others v. Atic Industries Ltd., Union Of India & Ors v. Hind Lamp Ltd., Commissioner of Central Excise, Hyderabad v. Detergents India Ltd. and Commissioner of Central Excise, Chandigarh v. M/s Kwality Ice Cream Co.
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