No Artificial Price to Evade Duty

Last updated: 20 February 2008

Court :
ITAT

Brief :
The applicant M/s Berger Paints India Ltd. is a manufacture of paints and varnishes which are the goods notified and subjected to assessment under Section 4A of the Central Excise Act, 1944 on the basis of MRP of the product. One of the products manufactured by the applicant is base material for paints which is intended to obtain colour range of over 5000 shades by tracing through a system called Berger Colour Bank Dispensing System, which are installed at the premises of their dealers. The company imports the colourants on payment of Chemical Vapour Deposition. The base paint is cleared from the factory in a packed tin, on payment of appropriate duty of excise on the basis of MRP of the paints under Sec. 4A. The colourant, which is imported by the applicant, is subsequently dispatched to the depots. In the dealers premises, on identification of a particular shade by the ultimate consumer, the base in pre-packaged form is opened, colourants are added to the quantity required by the consumer and the same is tinted. After tinting, the shade of the consumers choice is obtained. In this process, the lid or cap of the package containing base material is opened and after tinting it with the colour the same is delivered to the customer.

Citation :
2008-TIOL-269-CESTAT-MUM