TMI Blog2009 (12) TMI 416X X X X Extracts X X X X X X X X Extracts X X X X ..... interest on receivable is deductible. - E/4630/2004 and E/427/2005 - 1397-1398/2009-EX(PB), - Dated:- 18-12-2009 - Justice R.M.S. Khandeparkar, President and Shri Rakesh Kumar, Member (T) REPRESENTED BY: Shri Shekhar Vyas, Advocate, for the Appellant. Shri R.K. Verma, DR, for the Respondent. [Order per: Rakesh Kumar, Member (T) (Oral)]. - The facts leading to these two appeals by the appellant against order-in-appeal No. 433-434-CE/BPL/2004, dated 11-6-04 passed by CCE (Appeals), Bhopal, are, in brief, as under :- 1.1 The appellants in their factory at Village Pankha, Distt. Betul (M.P.), manufacturer Pneumatic Tyres of Rubber for motor vehicles, chargeable to Central Excise Duty under sub-heading 4011.90 of Central Excise Tariff Act, 1985. The period of dispute in these appeals is from March, 1997 to July, 2001 and December, 2001 to March, 2002. During this period, the appellants were removing the tyres to their depots on payment of duty, from where the same were being sold. Assessment of duty during these two periods was provisional. The provisional assessments were finalised by the Jurisdictional Deputy Commissioner, Central Excise vide order-in-orig ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and since there is no price list, circular etc. mentioning the discounts and the eligibility criteria, the same are not available to the appellant. (iii) The turnover/cash discount claimed as deduction has not been reflected in the factory/depot invoices. No evidence has been produced by the appellant to indicate that they had any structured policy in this regard. In view of this, the turnover/cash discount is also disallowed. (iv) For any deduction from the assessable value of Sales tax/CST it has to be shown that the same has been paid or is payable. Since in this regard the appellant have not submitted the evidence, its deduction was wrongly allowed. (v) The deduction claimed on account of bank collection charges/DD commission has been allowed on average basis twice for the same type of commission. The deduction on this account has been allowed without the appellant producing correlating evidence is not permissible. (vi) There is no provision in the Central Excise law for deduction from the assessable value on account of old dues receivable from the buyers and paying duty on the remaining assessable value. Hence, the differential duty has to be demanded on the free of c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ned order, made the following submissions :- (i) The expenses on transportation of the goods from the place of removal to the customer's premises have not been shown separately in the excise invoices and therefore in term of Rule 5 of the Central Excise Valuation Rules, 2000, its deduction is not permissible. (ii) Deduction of Sales tax/CST which has not been paid and whose liability has not accrued, as reflected in the balance sheet, is not permissible. (iii) The CCE (Appeals) has rightly disallowed the deduction of the trade discounts in respect of which there was no circular or price list and as such, the same were not known prior to removal and in respect of which there was no evidence that the same had been passed on to the customers. (iv) As regards the bank collection charges reiterating the department's stand before the CCE (Appeals), he pleaded that its deduction has been allowed twice by the Deputy Commissioner. 4. We have carefully considered the submissions from both the sides and perused the records. 4.1 The first point of dispute is on the question as to whether in this case exclusion of expenses of transportation of the goods from the place of removal to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he transaction value excluding the cost of transportation from the place of removal upto the place of delivery of such excisable goods, provided that the cost of transportation is charged to the buyer in addition to the price for the goods and is shown separately in the invoice for such excisable goods. However, since exclusion is only of the cost of transportation from the place of removal to the place of delivery, in case the place of removal is Depot or Consignment Agent's premises or any other place, no deduction will be permissible of the cost of transportation from the factory gate to such place of removal. Thus, during the period prior to 1-7-2000, the cost of transportation from the place of removal to the place of delivery is not includible in the assessable value and during the period w.e.f. 1-7-2000, the deduction of transportation cost from the place of removal to the place of delivery is permissible only if this has been charged from the buyer in addition to the price of the goods and is shown in the invoice. A Larger Bench of the Tribunal in case of CCE, Mumbai-III v. Supreme Petrochem Ltd. reported in 2009 (240) E.L.T. 38 (Tri.-LB) has held that since the transacti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be allowed only of the Excise, Sales tax and other taxes which have been paid or are payable, the question as to whether the quantum of deduction al lowed is correct is a question of fact which has to be decided by the original Adjudicating Authority as the impugned order in appeal does not give any details of the facts on the basis of which the Commissioner (Appeals) has inferred that the deduction of Sales tax/CST has not been correctly flowed. 4.3 As regards, the exclusion from the assessable value of the cash discount, turnover discount as per the principle, in this regard laid down by the Hon'ble Supreme Court in the cases of Assistant Collector of Cen tral Excise Others v. MRF Ltd. Others reported in 1987 (27) E.L.T. 553 (S.C.) and Union of India v. Bombay Tyres International reported in 1983 (14) E.L.T. 1896 (S.C.), the exclusion of such discounts from the assessable value has to be al lowed, if they are given under the terms of the sale or by established trade practice and are known prior to removal of the goods and the same have actually been passed on to the buyers. Though these judgments of Hon'ble Supreme Court are in respect of old Section 4, the principles laid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of post-manufacturing and post-clearing expenses and should be deductible from the assessable value. It cannot be stated that such expenses will form part of the sale price. The view taken by us finds support from the decision of this Court m Commissioner of Central Excise, New Delhi v. Vikram Detergent. Ltd., 2001 (127) E.L.T 641 (S.C.) = 2001 (2) SCC 417, which conclusion was arrived at by this Court after examining earlier decisions of this Court in Asst. CCE v. Madras Rubber Factory Ltd. (supra), Shriram Fertilizers Chemicals v. Union of India 1997 (96) E.L.T. 12 (S.C.), and Government of India v. Madras Rubber Fac tory Ltd. (supra). These three cases were adverted to by a Bench of three Judges to hold that the interest on receivables arises on account of time lapse between the delivery of goods and the realisation of monies is de ductible from the assessable value of the goods at the time of removal from the factory of the assessee. For the Same reason, bank charges included in the price on account of clearance of outstation cheques cannot form part of the price of the goods at the time of removal and as such excludible from the price while calculating the assessable value ..... X X X X Extracts X X X X X X X X Extracts X X X X
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