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2016 (4) TMI 16 - AT - Central ExciseUnder-valuation of the goods - “place of removal” under Section 4 of the Central Excise Act 1944 - Held that:- The finding of the Adjudicating Authority that the appellant is required to pay duty on such goods sold from the depot at a higher price over and above price as declared in their declaration, is contrary to provision of Section 4(1)(a) of the Act, 1944 and the case laws. It is not in dispute that the appellant cleared the goods from their factory, at the price prevalent at the depot and therefore, the demand of duty cannot be raised for increase of the price after clearance of the goods from the depot. Thus, the demand of duty cannot be sustained. With regard to demand of duty for the period from 28.9.1996 to March 1999 the Adjudicating Authority observed on the basis table as mentioned in the impugned order, that there was difference in price between the columns “Rate Charged from Customer from Depot” and “Declared Price of Goods in the factory at which duty paid at the time clearance /Sale Price (S.P.)”. It is observed that S.P. is inclusive of duty. The appellant in their reply to show cause notice categorically stated that the duty element is required to be excluded in the invoice value of the depot. The appellant also submitted some of the copies of invoices to show that the price it depot is cum-duty price. It is noticed that as per Section 4 (3) (d) of the Act, 1944, value in relation to any excisable goods does not include excise duty, sales tax etc., Hence, the findings of the Adjudicating Authority that the factory price is inclusive of duty cannot be sustained. Denial of benefit of cash discounts from assessable value - Held that:- It is not in dispute that the duty has been demanded in respect of cash discount, which was not actually passed on to the customer. The Hon’ble Supreme Court in the case of Purolator India Ltd [2015 (8) TMI 1014 - SUPREME COURT ] set aside demand of duty on cash discount issue. The Hon’ble Supreme Court allowed cash discount even after introduction of Transaction Value for the reason the cash discount for prompt payment as agreed by the buyer at the time of clearance of goods is a contractual price and it would be deducted from the sale price. It may be noted that the present case is prior to July 2000 and therefore, the appellant is eligible for deduction of cash discount from the assessable value.
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