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2024 (1) TMI 883 - AT - Central ExciseValuation of Excise Duty - whether the freight charges are includible in the assessable value or not? - HELD THAT:- On perusal of the Purchase Order, it is seen that delivery of goods is on ‘EX-WORKS’ basis and its insurance is covered by the appellant. In the case of Commissioner of Customs & Central Excise vs. Ispat Industries Limited [2015 (10) TMI 613 - SUPREME COURT], it was noted by the Hon’ble Apex Court that the place of removal is to be determined on the facts of each case. The payment of insurance charges or freight charges cannot be criteria for deciding the place of removal. The documents show that there is mutual agreement between the parties on ‘EX-WORKS’ price. The contention of the department that because the insurance charges are borne by the appellant upto the buyers premises from factory gate, the transfer of property in the goods has not been passed on to buyer at the factory gate, cannot be accepted. The Circular issued by the Board vide F.No. 988/12/2014-CX dated 20.10.2014 as well as F.No. 999/6/2015-CX dated 28.02.2015 has clarified that handing over the goods to the transporter for the purpose of delivery to the buyer without reserving the right of disposal of goods would be the place of removal. In the present case goods are handed over to the transporter only for carrying the goods up to buyer’s premise. As per mutual understanding the price is determined as ex-factory price and therefore, the goods are at the disposal of the buyer after it leaves the factory gate. The decision rendered by the Tribunal in the case of IDMC Limited [2023 (3) TMI 735 - CESTAT AHMEDABAD] would be clearly applicable to the facts of the present case. In the said case, it was held that insurance charges borne by manufacturer cannot be the sole reason to decide the ownership of the goods. The decision relied by learned AR in the case of Principal Commissioner, Raipur vs. M/s. Unique Structures and Towers Limited [2019 (9) TMI 1007 - CESTAT NEW DELHI] is of no assistance to the Revenue for the reasons that in the said case the fact shows that the price was inclusive of freight charges as agreed to between the parties - It was therefore held that freight charges are includible in the assessable value. In the present case, as discussed above the issue is covered by the decision in the case IDMC Limited. Thus, the freight charges are not to be included in the assessable value. The demand cannot be sustained - appeal allowed.
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