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TMI Blog2009 (3) TMI 351X X X X Extracts X X X X X X X X Extracts X X X X ..... al dated 31-10-2001, reduced the penalty under Section 11AC of Central Excise Act, 1944 read with Rule 173Q of Central Excise Rules, 1944 to Rs. 3.00 Lakhs. 2. The facts of the case, in brief, leading to this appeal are as under. 2.1 The appellant are engaged in the manufacture of liquefied and compressed oxygen gas in cylinders, which is chargeable to Central Excise duty under tariff item 2804.19 of the Central Excise Tariff Act, 1985. The gas is sold by the appellant in their own cylinders and also in some cases, in the cylinders brought by the customers. In the course of scrutiny of the records by the jurisdictional Central Excise Officers during their visit to the factory on 17-9-99, it was found that — (a) the appellant was charging ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h Rule 173Q(1) of Central Excise Rules, 1944. 2.3 The Commissioner (Appeals) by the impugned Order-in-Appeal dated 21-5-04 while upholding the duty demand alongwith interest, reduced the penalty to Rs. 3.00 Lakhs. It is against this order that the present appeal has been filed. 3. Heard both the sides. 3.1 Shri Rajesh Chibbar, Advocate, the ld. Counsel for the appellant, pleaded that it is settled law that cylinder rental as well as expenses for their transport, expenses incurred on maintenance/repair or testing of cylinder are not includible in the assessable value of the goods and in view of this even if the amounts charged by the appellant for cylinder rental, maintenance and repairs of cylinders, cylinder freight, testing etc. are mo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xygen (P) Ltd. v. CCE, Jaipur reported in 2000 (121) E.L.T. 369 (Tribunal) has held that when cylinder maintenance charges and cylinder rental charges, in respect of the sale of acetylene gas affected to purchasers in cylinders owned by them as well as to those buyers who lifted gas in cylinders belonging to the manufacturer were being charged at a fixed rate, the same would be includible in the assessable value and that the Hon'ble Supreme Court vide its order reported in 2001 (128) E.L.T. A68 (S.C.), has dismissed the SLP filed against this order of the Tribunal. In view of this he pleaded that the duty demand and imposition of penalty has been rightly upheld by the Commissioner (Appeals) in the impugned order. 4. We have carefully consi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erence i.e. the difference between the freight expenses actually incurred and the freight amount charged from the customers on equalised basis, is includible in the assessable value and there was no allegation that the freight on equalised basis being charged from the customers, has been artificially inflated and that it is in these circumstances that the Hon'ble Supreme Court held that the differential amount of freight in excess of the expenses toward freight actually incurred is not includible in the assessable value as duty of excise is on manufacture, not on profit made by the assessee or transporter. However, in this case, the facts are different. In this case, huge difference between the expenses towards cylinder testing and repair, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... justification for the appellants to collect the extra amount from their buyers on account of transportation. Such collections have rightly been held to be additional consideration for sale of the goods, which flowed back from the wholesale dealers to the appellant company and have been rightly included in the assessable value for the purposes of determination of Central Excise duty. Learned Advocates have referred to the Hon'ble Supreme Court's decision in the case of Indian Oxygen Ltd. - 1988 (36) E.L.T. 723 (S.C.) and Baroda Electric Meter Ltd. reported in - 1997 (94) E.L.T. 13 (S.C.) as also to other decisions of the Tribunal on the point i.e. extra realisation on account of transportation charges that the actual amount incurred, will n ..... X X X X Extracts X X X X X X X X Extracts X X X X
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