1997 (12) TMI 396 - AT - Central Excise

Summary

Issues:
Whether service charges, loading and unloading charges, and delivery and forwarding charges collected by the appellant separately from its customers of industrial gases are liable to be included in the assessable value of the goods.

Analysis:

1. Service Charges:
The appellant argued that service charges are for maintenance of durable and returnable gas cylinders, which should be excluded from the assessable value as per Section 4(4)(d)(ii) of the Central Excise Act, 1944. The Tribunal agreed, stating that expenses for maintenance of durable containers should not be included in the assessable value. The judgment referred to the Apex Court's decision in Indian Oxygen Ltd. to support this conclusion.

2. Loading and Unloading Charges:
The Tribunal differentiated between loading charges within the factory and those incurred during transportation outside the factory or at the customer's premises. It held that loading charges within the factory are includible in the assessable value, following the Apex Court's ruling. However, charges incurred during transportation outside the factory were excluded as they are part of the cost of transportation, which is statutorily excluded from the value of goods under Section 4(2) of the Act.

3. Delivery and Forwarding Charges:
Regarding delivery and forwarding charges, the Tribunal found that these charges are essentially transportation charges for delivering filled cylinders at the customer's premises. It ruled that such charges should not be included in the assessable value, in line with the Apex Court's decision in Indian Oxygen Ltd.

4. Rent for Retention of Cylinders:
The lower appellate authority had ordered the inclusion of rent collected by the appellant for retaining cylinders beyond the free period. However, the Tribunal held that this finding was beyond the scope of the show cause notice and referred to the Apex Court's ruling in Indian Oxygen Ltd., which favored the appellant. Consequently, the rental charges were deemed not includible in the assessable value.

5. Disposition:
The Tribunal disposed of the appeals in favor of the appellant, ruling that service charges, loading and unloading charges, delivery and forwarding charges, and rent for cylinder retention should not be included in the assessable value of the goods. The judgment was applicable to other appeals with similar issues, except for rental charges.

This detailed analysis of the judgment provides a comprehensive overview of the issues involved and the Tribunal's reasoning behind its decision on each issue.