2011 (5) TMI 186 - AT - Central Excise

Pre-deposit of duty - development charges received by the appellant from their foreign buyers - the said charges were received from foreign buyers to whom the goods were ultimately exported under bond without payment of duty - the appellant could not produce concrete proof in support of their submission - Thus they were unable to establish the said fact before Commissioner (Appeal)- But appellants now have the requisite documents to prove the above point- Hence set-aside the impugned order and remand the matter to Commissioner (Appeal) for examining the above claim of the appellant in relation to the documents to be produced by him before the appellate authority.

Summary

Issues:
1. Confirmation of duty on development charges received by the appellant from foreign buyers.
2. Inclusion of development charges in the assessable value of the final product.
3. Dispute regarding the purpose of development charges and their relation to export clearances.

Analysis:
The judgment by the Appellate Tribunal CESTAT, Ahmedabad, involved the confirmation of duty on development charges received by the appellant from their foreign buyers. The Commissioner (Appeal) had confirmed the duty, stating that the development charges, being additional consideration, must be included in the assessable value of the final product. The lower authority noted the ambiguity regarding whether these charges were for domestic clearances or non-duty paid export clearances, leading to the confirmation of the demand.

Upon hearing the arguments, the learned advocate for the appellants did not contest that the development charges should be added to the assessable value. However, he clarified that these charges were received from foreign buyers for the development of tools ultimately exported without duty payment. The advocate acknowledged the lack of concrete proof presented before the Commissioner (Appeal) to support this claim. He expressed readiness to provide the necessary documentation to substantiate the purpose of the charges and requested a remand to the Commissioner (Appeal) for further examination.

In light of the submissions, the Appellate Tribunal set aside the impugned order and remanded the matter to the Commissioner (Appeal) for a detailed review of the appellant's claim regarding the development charges and the supporting documents. The stay petition and appeal were consequently disposed of in the manner outlined, allowing for a reevaluation based on the additional evidence to be presented by the appellant.