Home Case Index All Cases Central Excise Central Excise + AT Central Excise - 2011 (6) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2011 (6) TMI 729 - CESTAT MUMBAIValue of bought out items directly supplied to customer’s sites is to be included in the assessable value of Centrifugal machine - HELD THAT:- In present case, customers placed purchase orders on the appellant for supply of electric motors, control panel, cables, etc., which are not manufactured by the appellants but purchased and sent directly to the site of the customers. Here, the centrifugal machine is assembled in the factory, tested with an electric motor and electric panel, disassembled and afterwards supplied. This process itself shows that electric centrifugal machine is incomplete without electric motor and control panel. In the case of MIL India Ltd., [2007 (3) TMI 8 - SUPREME COURT] itself allowed the deductions of duty paid on the goods supplied as bought out items. Therefore the claim of the appellant that what they had cleared was centrifugal machines without the bought out items and therefore the value of bought out items cannot be added is not correct. the actual price charged has to be the basis for calculation of excise duty and further the value of bought out items has to be added. As regards subsequent to 1-7-2000 assessment has to be based on transaction value. In this case the value has been brought down by the method adopted by the appellant by which they have been supplying bought out items separately under a separate invoice. Since the value of the complete centrifugal machine erected at site has to be arrived at it becomes necessary to add the value of bought out items charged by the appellant to their customer to the value of centrifugal machine. We find that observation of learned Commissioner that the conditions in the purchase order clearly suggested that in addition to the centrifugal machine, the appellant was responsible for specification of the control panel and the electric motor which were supplied with the centrifugal machine. Further the appellant was to give guarantee for the performance of the electric motor and the control panel. As already observed by us, the appellant was also required to ensure that the warranty for items supplied with the centrifugal machine is co-terminus with the warranty for the centrifugal machine. In view of the observations made by us that the cum-duty benefit has to be extended and while calculating differential duty, duty paid on bought out material supplied has to be adjusted, the matter is required to be remanded to the original adjudicating authority once again for this limited purpose of re-computation of differential duty after taking into account the duty paid on bought out items and treating the value as cum-duty value as requested by the appellants. the impugned orders are set aside and the matter remanded to the original adjudicating authority for fresh decision.
|