S. Sarwar Ali, J.
1. In this writ application the petitioner prays for quashing of annexures 8, 11 and 13. By Annexure 8 the petitioner was required to deposit a sum of Rs. 19,863.55 paise being the amount of short assessment from March, 1969 to November, 1969 in respect of Excise duty payable by the petitioner. Annexure 11 is the order passed by the Deupty Controller of Central Excise disposing of the appeal of the petitioner objecting to the aforesaid demand. Annexure 13 is the order passed by the Government of India on the revision application which was filed by the petitioner under the provisions of the Central Excises and Salt Act, 1944 (hereinafter referred to as 'the Act').
2. The facts leading to the filing, of this application may be briefly stated. The petitioner is a firm of partnership and manufactures and sells electric lamps, fluorescent tubes etc. of various specifications. Wholesale sales are affected by the petitioner to general trade as also to some parties, who make bulk purchases. The parties who make bulk purchases get the goods embossed on the cap or etched on the glass shells from inside with certain letters. The rate at which the goods are sold wholesale to the general trade in higher than the rate at which it is supplied to the bulk purchasers. During the period March, 1969 to November, 1969 the Excise authorities assessed the duties according to the contract rate and payments were accordingly made. Thus for the assessment of the Excise duty the contract price between the petitioner and those bulk purchasers was taken to be the criterion for the purpose of determining the Excise duty.
3. Under a notice issued under Rule 10A of the Central Excise Rules, 1944, the petitioner was required to make goods the short assessment the aforesaid period. It appears that the demand was made on the basis that the determination of value for the purpose of duty was to be made under Section 4(a) of the Act. The wholesale cash price for the goods sold by the petitioner must be reckoned to be the same both for the general trade as also for the bulk purchasers. Since the value was taken to be lower for the bulk purchasers, it became necessary to issue fresh notice. As already stated the demand was resisted both in appeal and revision, but the petitioner was unsuccessful at both the stages.
4. During the course of argument it has not been dispute that Section 4(a) of the Act is applicable to the transactions in question. Section 4(a) of the Act is as follows :
"4. Determination of value for the purpose of dutyWhere under this Act, any article is chargeable with duty at a rate dependent on the value of the article, such value shall be deemed to be
(a) the wholesale cash prince for which an article of the like kind and quality is sold or is capable of being sold at the time of the removal of the article chargeable with duty from the factory or any other premises of manufacture or production for delivery at the place of manufacture or production, or if a wholesale market does not exist for such article at such place, at the nearest place where such market exists, or"
It states that where duty is chargeable at rate dependent on the value of the article, the wholesale cash price shall be taken to be the value.
5. Learned counsel for the petitioner contended that the wholesale cash price so far as the sale to the bulk purchasers was concerned, was the price which was actually charged by the petitioner. He relied on the decision of the Supreme Court in A.K. Roy and Ors. v. Voltas Ltd. (A.I.R. 1973 Supreme Court 225). What the learned counsel contended amounts to this that there should be two wholesale rates depending on the amount that is charged by the manufacturer. The wholesale purchase rate for the purchaser is the amount that is actually paid by the purchaser. He contended that as long as the transaction between the manufacturer and the purchaser was a bona fide transaction and the parties were at arms length and the transaction in question was entered into in usual course of business, it is the price which is actually charged which is the wholesale purchage rate. The learned Standing Counsel for the respondents controverted all these
propositions.(sic)contended that the wholesale purchage price would be the same irrespective of the amount that is actually charged by the manufacturer. He further contended that the decision in Voltas Ltd.'s case (sup ) is distinguishable.
6. It is first necessary to appreciate the decision in Voltas Ltd.'s case (supra). Voltas Ltd. carried on, among anothers, the business of manufacturing air conditioners etc. It had its sales offices at various places. From these sales offices it effected direct sales to consumers at list prices. Such sales came to about 90 to 95 per cent of its production. It also sold the articles to wholesale dealers from different parts of the country in pursuance of agreements entered into with them. The agreements provided, among other things, that the dealers should not sell the articles sold to them except in accordance with the list prices fixed by the respondent, and that the articles will be sold to them by Voltas Ltd. at the list prices less 22 per cent discount. It was in those circumstances that it was considered whether the price of goods charged by the Voltas Ltd. From those wholesale dealers could be taken to be the wholesale cash price. It was in that context that observations were made in paragraph 18 of the judgement which are relied upon by the learned counsel for the petitioner. It was observed
"If a manufacturer were to enter into agreements with dealers for wholesale sales of the articles manufactured on certain terms and conditions, it would not follow from that belong that the price for those sales would not be the 'wholesale cash price' for the purpose of Section 4(a) of the Act if the agreements were made at arras length and in the usual course of business."
It was further observed that the wholesale cash price has to be ascertained only on the basis of transactions at arms length. Learned counsel for the petitioner contended that in this case also the parties were at arms length and the transactions in question are entered into in the usual course of business. It was, therefore, contended that applying the aforesaid observations, it must be held that the price paid by the bulk purchasers was the wholesale cash price. In my view. this contention cannot be accepted. The reason is that the observations already extracted were made in the context of transactions which were entered into between wholesale dealers and the company Voltas Ltd. There were only two sets of transactions, one to the general trade and the other to parties to whom some preferential terms were given. The observations made in the Voltas's case (supra) have to be read in the context of the facts of the case and the observations cannot be extended to mean that in all the cases where there is a contract price between the parties that has to be taken to be the wholesale cash price.
7. The language of Section 4(a) of the Act is quite clear and specific. It states that the wholesale cash price will be deemed to be the value for the purpose of assessment of the duty. Wholesale cash price is to be determined in relation to the sale or business transactions of the assessee. It cannot be one wholesale cash price for one party and other for another party for the same period. Ordinarily, the wholesale cash price has to be the same irrespective of the contractual rate. It, as an objective fact, has to be determined by an authority under the Act. In the instant case, it has been found by the authorities that the wholesale cash price for the goods should be the same both for the general trade as also for the bulk purchasers. There is no illegality in this determination. In this view of the matter, I am of the view that it is not possible to interfere with the impugned orders.
8. In the result, this application is dismissed, but in the circumstances of the case without costs.