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2017 (3) TMI 724 - AT - Central ExciseValuation - related party transaction - Since the appellants and Luxor were related persons, the appellants adopted the maximum retail price of the pens, as fixed by Luxor, for discharging the duty since beginning, from which the appellant have worked out the assessable value - whether the appellants were correct in claiming the deduction on account of duty from the cum-duty price of Luxor to arrive at the transaction value? - Held that: - From the definition of transaction value under Section 4(3)(d) (w.e.f. 01.07.2000), it is seen that the deduction is available from the price actually paid or payable for the goods when sold, to the extent of amount of duty of excise, sales tax and other taxes, if any, actually paid or actually payable on such goods. An Explanation has been added to Section 4(1) with effect from 14.05.2003 through which the concept of cum-duty price was inserted in Section 4. This explanation explains how the “price-cum-duty” of the excisable goods has to be arrived at. The explanation provides for deduction of sales tax and other taxes, if any actually paid. Further, the explanation specifies that the price-cum duty so arrived at shall be deemed to include the duty payable on such goods - When we look at the calculation attached by the appellant in arriving at assessable value, we find that the retail price is the price charged by Luxor. From such retail price, initially the retailer and distributor margins are deducted to arrive at the price to distributor. Subsequently, the sales tax actually paid is deducted followed by the allowable deduction for discounts as well as the amount attributable to freight involved in transportation of the goods, from which the excise duty element is deducted to arrive at the assessable value - the explanation allowed deduction in respect of only trade discount and the amount of duty payable. Even though, the concept of value with effect from 01.7.2000 and the concept of price-cum duty with effect from 14.05.2003 are not identical to the pre 1975 provisions, the two are similar in respect of deduction which shall be allowed to arrive at value. Time limitation - Held that: - It is clear that appellant has claimed deduction for excise duty to arrive at the assessable value and accordingly claimed the benefit of exemption notification. Since all the relevant facts were in the knowledge of the department, we are of the view that the extended period of limitation is not applicable. Appeal allowed - decided in favor of appellant.
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