# YATINDRANATH SHUKLA AND ORS. KANPUR v. COLLECTOR OF CENTRAL EXCISE, KANPUR

- **Citation:** [1997] Supp. 6 S.C.R. 359
- **Court:** Supreme Court of India
- **Decided:** 1997-12-09
- **Case number:** Civil Appeal Nos. 3030-31 E of 1989
- **Bench:** S.C. Sen, M. Srinivasan
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/yatindranath-shukla-and-ors-kanpur-v-collector-of-central-excise-kanpur-15959
- **Pages:** 4

## Headnote

B
Excise Law:
Central Excises and Salt Act, 1944 : Section 4.
Excise duty-Exemption of-valuation-Method orHeld: Is the same C
as for levy of duty-Hence, value per kg of chewing tobacco for pwpose of
Exemption Notification No. 35/79-CE dated 1.3.1979 as amended by
Notification No. 151/79-CE dated 30.3.1979 is to be anived at by dividing the
total value of the package in its entirety by the total weight of the package and
not by the 11et weight of the co11tents of the package-Central Excise Rules, D
1944, R. 8(1)----Additional Duties of Excise (Goods of Special Importance)
Act, 1957, S. 7(3)
Excise duty-Packing mate1ial-Value of-lncludibility in-Held : For
pwpose of aniving at excise duty the value of packing maten"al should also
be included to anive at the assessable value of excisable goods.
E
The appellant-assessee was a manufacturer of chewing tobacco. The
Customs, Excise & Gold Control Appellate Tribunal held that the value
per kilogram of chewing tobacco had to be arrived at by dividing the value.
of the total package by the net weighf of the tobacco after excluding the
weight of the packing material from the weight of the total package for the
purpose of Exemption Notification No. 35/79-CE dated 1.3.1979 as
amended by Notification No. 151/79-CE dated 30.3.1979. The Tribunal
further held that for purpose of levying excise duty the value of the packing
material should be excluded to arrive at the assessable value of the
excisable goods. Hence this appeal.
On behalf of the appellant-assessee it was contended that for arriving at the value per kilogram of chewing tobacco the total value of the
entire package should be divided by the total weight of the package.
Disposing of the appeals, this Court
359
F
G
H
360
SUPREME COURT REPORTS (1997] SUPP. 6 S.C.R.
A
HELD : 1. For the purpose of levying duty under the provisions of
B
the Central Excises and Salt Act, 1944 the value of the packing materials
should also be included to arrive at the assessable value of the excisable
goods. [360-G]
Govemment of India v. Madras Rubber Factwy, [1995) 4 SCC 349,
relied on.
2. When for the purpose of assessing the value and levying the duty,
the total value of the package is taken as assessable value of the goods
under Section 4 of the Act, the same method shall be applied for assessing
C the value of the goods for the purpose of exemption. Hence, for the purpose
of exemption Notification No. 35/79-CE dated 13.1979 as amended by
Notification No. 151/79-CE dated 30.3.1979 the value of the chewing tobacco per kilogram shall be arrived at by dividing the total value of the
package in its entirety by the total weight of the package. [361-A; 362-A-C]
D

## Text

-
YATINDRANATH SHUKLA AND ORS. KANPUR
A
v.
COLLECTOR OF CENTRAL EXCISE, KANPUR
DECEMBER 9, 1997
(S.C. SEN AND M. SRINIVASAN, JJ.]
B
Excise Law:
Central Excises and Salt Act, 1944 : Section 4.
Excise duty-Exemption of-valuation-Method orHeld: Is the same C
as for levy of duty-Hence, value per kg of chewing tobacco for pwpose of
Exemption Notification No. 35/79-CE dated 1.3.1979 as amended by
Notification No. 151/79-CE dated 30.3.1979 is to be anived at by dividing the
total value of the package in its entirety by the total weight of the package and
not by the 11et weight of the co11tents of the package-Central Excise Rules, D
1944, R. 8(1)----Additional Duties of Excise (Goods of Special Importance)
Act, 1957, S. 7(3)
Excise duty-Packing mate1ial-Value of-lncludibility in-Held : For
pwpose of aniving at excise duty the value of packing maten"al should also
be included to anive at the assessable value of excisable goods.
E
The appellant-assessee was a manufacturer of chewing tobacco. The
Customs, Excise & Gold Control Appellate Tribunal held that the value
per kilogram of chewing tobacco had to be arrived at by dividing the value.
of the total package by the net weighf of the tobacco after excluding the
weight of the packing material from the weight of the total package for the
purpose of Exemption Notification No. 35/79-CE dated 1.3.1979 as
amended by Notification No. 151/79-CE dated 30.3.1979. The Tribunal
further held that for purpose of levying excise duty the value of the packing
material should be excluded to arrive at the assessable value of the
excisable goods. Hence this appeal.
On behalf of the appellant-assessee it was contended that for arriving at the value per kilogram of chewing tobacco the total value of the
entire package should be divided by the total weight of the package.
Disposing of the appeals, this Court
359
F
G
H
360
SUPREME COURT REPORTS (1997] SUPP. 6 S.C.R.
A
HELD : 1. For the purpose of levying duty under the provisions of
B
the Central Excises and Salt Act, 1944 the value of the packing materials
should also be included to arrive at the assessable value of the excisable
goods. [360-G]
Govemment of India v. Madras Rubber Factwy, [1995) 4 SCC 349,
relied on.
2. When for the purpose of assessing the value and levying the duty,
the total value of the package is taken as assessable value of the goods
under Section 4 of the Act, the same method shall be applied for assessing
C the value of the goods for the purpose of exemption. Hence, for the purpose
of exemption Notification No. 35/79-CE dated 13.1979 as amended by
Notification No. 151/79-CE dated 30.3.1979 the value of the chewing tobacco per kilogram shall be arrived at by dividing the total value of the
package in its entirety by the total weight of the package. [361-A; 362-A-C]
D
CIVIL APPELLATE JURISDICTION: Civil Appeal Nos. 3030-31
E
of 1989 Etc.
From the Judgment and Order dated 27.3.89 of the Customs, Excise
and Gold Control Appellate Tribunal, New Delhi in Order No. 155- 156
of 1989-A.
V. Laxmikumaran, V. Shridharan, T. Vishwanathan and V.
Balachandran for the Appellants.
R. Chaudhary and V.K. Verma for the Respondents.
F
The Judgment of the Court was delivered by
SRINIVASAN, J. These appeals are directed against the order of the
Customs Excise & Gold Control Appellate Tribunal, New Delhi. Civil
appeal Nos. 3030-31 of 1989 are by the assessee while the other appeals
are by the Revenue. Two questions arise for consideration. One of them,·
G has already been concluded by the judgment of this Court Govemment of\
India and Others v. Madras Rubber Factory and Otlze1:1-, [1995] 4 S.C.C. 349. '
In that case it has been held that for the purpose of levying duty under the
provisions of the Act the value of the packing materials should also be
included to arrive at the assessable value of the excisable goods. The
H Tribunal has directed the exclusion of the value of packing materials and
-
YATINDRANATHSHUKLAv. C.C.E.(SRINIVASAN,J.]
361
thus the Revenue is aggrieved. In view of the aforesaid judgment of this A
Court, the appeals of the Revenue are hereby allowed to that extent.
2. The other question which arises for consideration relates to the
method of arriving at the value of chewing tobacco per kilogram under
Notification No. 35/79/C.E. dated 1.3.1979 as amended by Notification No.
151/79 C.E. dated 30.3.1979. The Notification in so far as it is relevant reads B
as follows:
Exemption to chewing tobacco. -·In exercise of the powers conferred by sub-rule (1) of Rule 8 of the Central Excise Rules 1944,
read with sub-section (3) of Section 3 of the Additional Duties of C
Excise (Goods of Special Importance) Act, 1957 (58 of 1957), the
Centi al Government hereby exempts chewing tobacco of the
description specified in column (1) of the Table hereto annexed
and falling under sub-item 11(5) of Item No. 4 of the First Schedule
to the Central Excise and Salt Act 1944 (1 of 1944) from so much D
of the duty of excise leviable thereon both under the Central Excise
and Salt Act, 1944 (1 of 1944) and the Additional Duties of Excise
(Goods of Special Importance) Act 1957 (58of1957) as is in excess
of the duty specified in corresponding entry in column (2) thereof.
THE TABLE
Description
1
Chewing tobacco of which
the value per one kilogram -
(i) does, not exceed rupees
ten
(ii) exceeds rupees ten
Rate of duty
2
fifteen per cent ad velorem
Twenty five per cent ad
valorem
E
F
3. The contention of the assessee is that for arriving at the value per G
kilogram of chewing tobacco the total value of the entire package should
be divided by the total weight of the package. The contention of the
Revenue is that the value of the tobacco has to be arrived at by dividing
the value of the total package divided by the net weight of the tobacco after
excluding the weight of the packing materials from the weight of the total H
362
SUPREME COURT REPORTS (1997) SUPP. 6 S.C.R.
A package. It is argued by the Revenue that the Notification uses the expression "chewing tobacco" and speaks of value per one kilogram. According
to learned counsel it would mean tobacco before its being packed and the
weight thereof.
4. There is no merit in this contention. When for the purpose of
B assessing the value and levying the duty, the total value of the package is
taken as assessable value of the goods under Section 4 of the Act, the same
method shall be applied for assessing the value of the goods for the
purpose of exemption. We accept the contention of the assessees in this
regard and hold that for the purpose of exemption notification the value
C of the chewing tobacco per kilogram shall be arrived at by dividing the total
value of the package in its entirety by the total weight of the package.
5. The view expressed by the Tribunal to the contrary is erroneous
and therefore the order of the Tribunal is set aside to that extent. The
appeals are disposed accordingly. The Assistant Collector shall pass apD
propriate orders in accordance with the above decision .
..
v.s.s.
Appeals disposed of.