TMI Blog2007 (10) TMI 209X X X X Extracts X X X X X X X X Extracts X X X X ..... hri K.K. Agarwal, Member (T) [Order per : K.K. Agarwal, Member (T)].- 1. These are three appeals, two by revenue and one by the respondent M/s Malwa Cotton Spinning Mills Ltd. Since, the issue involved in the three appeals is the same, they are being decided through a common order. 2. The brief facts of the case are that M/s Malwa Cotton Spinning Mills Ltd. are engaged in the manufacture of cotton yarn and MM yarn and were selling the same through their depots located at different places. Under the new valuation rules, the duty was required to be paid at the price at which the depot was selling the goods. Since, the exact value of the finished goods sold through depot was not known at the time of clearance from the factory ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed goods to their depots for further sale of goods, they were required to pay Central Excise Duty on these finished goods in terms of Rule 7 of the Valuation Rules i.e. on the normal transaction valued prevailing at the depot, at or about the same time or at the time nearest to the time of removal of goods from the factory. If there were sales at different prices on the same day, then as per Rule 2 (b) of the Central Excise Valuation Rules 2000, the price on which greatest aggregate quantity was sold was to be adopted as normal transaction value. Since, this was not done, a show cause notice was issued seeking sought to demand duty on the basis of price at which the greatest aggregate quantity was sold on a particular date instead of the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stomer depended upon the date of actual payment. Hence, in such transactions, where the cash discount was known, at the time of issue of invoice, the same were shown on the invoice itself, however, on other transactions the cash discount was passed on subsequently by way of credit notes. The department did not consider these credit notes and has raised the demand. Commissioner (Appeals) agreed with the plea taken by the appellants and held that so far as the payment of duty on average price is concerned, the same was in order up to 01/07/02 as the CEGAT decision, on the basis of which the duty was to be charged at the greatest quantity sold on the same day was effective from 01/07/02, therefore, he did not disturb the demand of duty for the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as to whether cash discount has been really passed on to the buyers or not as assessee has not produced any documents/ vouchers/debit notes before the adjudicating authority. There is no evidence to show that credit notes related to cash discounts only. It was also submitted that penalty is imposable on the party as they have tried to evade payment of duty by taking inadmissible deductions in violation of Valuation Rules 2000. 7. The learned advocate for the respondents M/s Malwa Cotton Spinning Mills submitted that so far as the requirement of paying duty at the price of greatest aggregate quantity is concerned, they are agreeing that the same shall be applicable w.e.f. 01/07/00 but it is their contention that there are cases where th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s that though the invoice is issued for the full value payment was received by adjusting the admissible discount by the customers. They submitted that in an identical matter in their own unit, the above practice was brought to the notice of the Tribunal, and Tribunal has vide its order No. 1350-51/06-SM dated 30/08/06 remanded the matter back to the original authority to consider their claim by looking into the book of accounts with liberty to the appellants to produce a certificate from Chartered Accountant in support which may be considered by the adjudicating authority. He, therefore, submitted that the matter of cash discount in the present appeal may also be remanded back to the adjudicating authority. 9. We have considered submis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) E.L.T. 217. This matter is therefore remanded back to the original authority to verify the practice followed by the appellants, as per their claim and thereafter decide the admissibility of the cash discount. 11. As regards appeal No. E/2864/04, filed by M/s Malwa Cotton Spinning Mills regarding denial of refund claim on account of unjust enrichment relating to the duty paid by the appellants on the cash discount, since the issue of admissibility of cash discount itself has been remanded back to the original authority, this matter also needs a remand to take a afresh view on the refund claim. Once it is found that cash discounts are admissible the refund claim should be considered accordingly by taking into account the fact that the a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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