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2012 (4) TMI 555 - CESTAT NEW DELHILiability of excise duty - excess transportation charges - Department was of the view that since the appellant has charged excess transportation charges from his customer, in view of Rule 5 of Valuation Rules, 2000, appellant is liable to pay excise duty on excess transportation charges - Held that: - the transaction value of goods supplied in this case is to be calculated on the basis of Section 4(1)(a) i.e. the sale price of goods charged at the factory gate. Admittedly, on that price the excise duty have been paid. Merely because the appellant has made profit on transportation from the place of removal to the place of delivery, it cannot be said that the aforesaid profit has any co-relation with the goods cleared to factory gate as such he cannot be asked to pay excise duty on the freight. Similar issue decided in the case of Baroda Electric Meters Ltd. v. C.C.E. [1997 (7) TMI 126 - SUPREME COURT OF INDIA] where it was held that the “equalized freight charged from everyone freight actually paid less than the amount collected by way of equalized freight, differential amount not includible in the assessable value since the duty of excise is on manufacture and not on profit made by a dealer on transportation”. Appeal allowed - decided in favor of appellant.
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