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2020 (12) TMI 1056 - AT - Central ExciseValuation - inclusion of Freight charges in the assessable value - place of removal - premises of the buyers - appellant paid duty on the assessable value without including the value of freight, as according to the appellant, freight was incurred beyond the place of removal which is the factory gate of the appellant - HELD THAT:- The sale invoices raised by the appellant clearly mentioned at serial number 4 that "our responsibility ceases when goods leave factory". Rule 5 of the Central Excise Valuation (Determination of Price of Excisable Goods) Rules, 2000 also provides that the cost of transportation from the place of removal to the place of delivery is not includable in the assessable value. The cost of transportation has also been separately mentioned in invoices and this cost is paid by the buyer. It is, therefore, evident that the factory gate is the place of removal and duty is charged at the price of the goods charged at the factory gate. Merely, because the payment of transit insurance has been made by the appellant would not mean that the place of removal would be the place of the buyer - the payment of transit insurance by the appellant is not a decisive factor for determining the place of removal. The Supreme Court in COMMISSIONER OF CUSTOMS AND CENTRAL EXCISE, NAGPUR VERSUS M/S ISPAT INDUSTRIES LTD. [2015 (10) TMI 613 - SUPREME COURT] considered this situation in detail. According to the Department, the said Industry evaded Central Excise duty by mis-declaring that the factory gate was the place of removal and not the buyer's premises and, consequently, the freight charges were required to be added in determining the assessable value. The Commissioner held that the premises of the customer was actually the place of removal and not the factory gate of the Industry. In regard to the payment made by the appellant to the buyer for any transit loss, the appellant has submitted that such charges were paid only in cases where the transit loss was more than 30 kg and even these cases, the charges were recovered from the transporters. The Commissioner (Appeals) was not justified in holding that the value of freight charges was required to be added in the assessable value of the goods - Appeal allowed - decided in favor of appellant.
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