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2019 (2) TMI 1551 - CESTAT MUMBAIValuation - inclusion of element of discount in the assessable value - Provisional assessment or not? - Whether in case of clearance of goods from the depot, the assessment have to be treated as provisional even if the procedure as prescribe by Rules is not followed? - Held that:- In the present case assessments were made by the appellants in the scheme of self assessment without following the procedure laid down for making provisional assessments. The fact that clearance were being done from the depot would not make the assessments provisional in absence of the procedure as prescribed under of Central Excise Rules, 2002. Whether the scheme of quantity discount as followed by the appellants is admissible deduction? - Held that:- In the present case the goods are cleared by the appellants to their depot after claiming quantity discount as per their scheme of discount the goods are from depot cleared to various distributors across the country. The quantity discount as claimed at the time of clearance of goods from the factory to depot is not passed on to the distributors - In similar circumstances in case of Commander Water Tech Pvt Ltd [2017 (2) TMI 938 - CESTAT MUMBAI], it was held that Quantity discount is an admissible discount provided the same is known prior to clearance or removal and if it is passed on to the buyers in terms of Section 4 of the Central Excise Act, 1944 and the discount have been passed on - quantity discount as claimed by the appellants in the present case for clearance made to the depot is not an admissible deduction. Whether duty free replacements in respect of damaged/ expired goods permissible under the Scheme of Central Excise Act, 1944? - Held that:- Issue in respect of Damage Discounts is not resintegra - In case of MRF {1995 (5) TMI 28 - SUPREME COURT OF INDIA] three Member Bench of Hon’ble Supreme Court has held that The nature and character of the amount so being refunded is certainly not a trade discount contemplated by Section 4(4)(d)(ii), whether the claim is honoured by paying cash or by deducting it from the price of the new tyre - thus, the supply of goods as free replacement in respect of the damaged or expired goods has to be on payment of duty. Whether the demand is barred by limitation in the present case? - Held that:- In fact the scheme of clearance of goods by claiming quantity discount in respect of clearances made to depot was nothing but an instrument to claim the inadmissible damage discounts. Such scheme was adopted by the appellants with intention to evade payment of duty in respect of goods supplied as replacement for the damaged/ expired goods. None of the decisions relied upon by the appellants lay down the law that in such case were appellants willfully misdeclared the scheme as that of quantity discount, without passing on the benefit of said quantity discount to distributors, but to benefit itself in respect of free replacements made for damaged/ expired goods - Such colorable devices and instruments used for evasion of Central Excise duty would definitely bring the case within the proviso to Section 11A(1) of Central Excise Act, 1944. Penalty u/s 11AC - Held that:- Since it is held that extended period of limitation is applicable in present case, so is Section 11AC. Demand of Interest u/s 11AB of Central Excise Act, 1944 - Held that:- Interest is payable as statutory liability in case of short payment of service tax by the due date. Thus Demand for interest under Section 11AB of Central Excise Act, 1944 is also upheld in view of the Apex Court decision in case of Kerala State Electricity Board [2007 (12) TMI 2 - SUPREME COURT OF INDIA]. Appeal dismissed.
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