1998 (9) TMI 266 - AT - Central Excise

Summary

Issues:
1. Differential duty on additional charges collected by the appellant.
2. Inclusion of value of separate items in the assessable value of photocopiers.
3. Charges for freight and cartage collected by the appellant.
4. Exemption Notification No. 51/70 for MFRP.
5. Inclusion of toner and developer value in the assessable value of photocopiers.

Issue 1 - Differential Duty on Additional Charges:
The appellant, engaged in manufacturing photocopiers and MFRP, faced demands for not paying duty on extra amounts collected besides the price list prices. The appellant argued that these charges were for installation, commissioning, and bought-out articles, not to be included in the assessable value. The Collector confirmed the demand and imposed a penalty, rejecting the appellant's contentions.

Issue 2 - Inclusion of Separate Items in Assessable Value:
A show cause notice proposed demands in respect of photocopiers where the appellant had supplied separate items like drums, blades, toner, and developer to buyers without including their value in the assessable value. The notice also highlighted discrepancies in freight and cartage charges collected. The Collector confirmed the demand, reducing it for any duplication but rejecting other contentions raised by the appellant.

Issue 3 - Charges for Freight and Cartage:
The appellant collected charges for freight and cartage, contrary to the declared basis of actual expenses only. The Collector upheld the proposal to include the entire charges in the assessable value, alleging inconsistencies in charges collected. However, the correctness of this decision was challenged, suggesting a reevaluation based on actual expenses incurred.

Issue 4 - Exemption Notification No. 51/70 for MFRP:
The appellant's claim for exemption under Notification No. 51/70 for MFRP was rejected by the Collector, who declined to consider it due to the appellant not raising the plea during the approval of the classification list. The Tribunal highlighted the error in dismissing the claim solely based on the timing of raising the plea, emphasizing a reconsideration on merits.

Issue 5 - Inclusion of Toner and Developer Value:
A dispute arose regarding whether the cost of toner and developer supplied with photocopiers should be included in the assessable value. Referring to a previous decision, the Tribunal held that these items were consumables, not essential parts of the photocopier, and their value should not be included in the assessable value.

In conclusion, the Tribunal set aside the orders related to various issues, directing a reevaluation by the adjudicating authority. The appellant was granted the opportunity to present evidence and arguments on specific contentions, emphasizing the correct determination of assessable values and duty payable. The judgment highlighted the importance of considering all relevant aspects raised by the parties and ensuring a fair and thorough assessment process.