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2010 (4) TMI 724 - CESTAT, NEW DELHIValuation - Stock transferred - Dispute in these appeals in from September 1996 to February 1999 - The Appellant stock transferred a part of their goods to depots from where the same were being sold in retail - Held that: If at the time and place of removal, the sales are in retail only, from the retail price, the margin between wholesale price and retail price will have to be removed for arriving at the assessable value. Delear - Related person - There is no dispute that HMPL, DIPL and appointed dealers of Appellant are not a holding company, a subsidiary company, a relative and a distributor and a sub-distributor of such distributor - Therefore as per the provisions of Section 4(4)(c), the Appellant and HMPL/DIPL/appointed dealers can be “related person” within the meaning of this term as defined in Section 4(4)(c) only if they are so associated that they have interest, direct or indirect in the business of each other i.e. there is mutuality of interest in each other’s business - The Department makes an allegation that the Appellant and DMPL/DIPL/appointed dealers of appellant have mutual interest in each other’s business, the burden of proving this would be on the Department. But in this regard, other than the difference between the Appellant’s price to DMPL/DIPL/appointed dealers and the price changed by DMPL/ DIPL/appointed dealers from their customers, no other evidence has been discussed - Hence, they are not related person. Freight expenses - Deduction of freight expenses incurred on return of empty bottles, as held by the Tribunal in case of Herbatsons Ltd. v. CCE, Mumbai and Pure Drinks (ND) Ltd. v. CCE are not includible in the assessable value of the goods. Cost of packing - The cost of 12 litre, 20 litre and 24 litre bottles, since it is an admitted fact that the same were being returned for re-use, the same will have to be treated as of durable and returnable nature and just because the bottles have to be discarded after 40 cycles of use, the same would not cease to be of durable and returnable nature. Freight expenses - As regards the freight expenses for transportation of the goods from factory to Depot the same would have to be included in the assessable value of the goods, sold from the depot, as in such a case, it is the depot which has to be treated as the place of removal. Delivery charge/distribute charges - As regards the deduction of “delivery charge/distribute charges” for determining the assessable value, CCE (Appeals)’s order, while permitting their deduction does not discuss the nature of these charges - Then deduction would be permissible only if the same are purely the transport expenses for transport of the goods from the place of removal to the customer’s premises - But if these expenses are in the nature of “marketing and selling organisation expenses” in view of Hon’ble Supreme Court’s judgments in cases of Union of India and Others v. Bombay Tyre International reported in (1983 -TMI - 41391 - SUPREME COURT OF INDIA) and Government of India v. Madras Rubber Factory Ltd. reported in (1995 -TMI - 44005 - SUPREME COURT OF INDIA) their deduction will not be permissible.
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