TMI Blog2009 (3) TMI 351X X X X Extracts X X X X X X X X Extracts X X X X ..... the customers, - these charges were being recovered even from the customers who brought their own cylinders, leads to inevitable conclusion that these expenses have been artificially inflated in order to reduce the assessable value of the goods. – Impugned charges are includible in assessable value - E/450/2005-EX - 327/2009-EX(PB), - Dated:- 20-3-2009 - Justice R.M.S. Khandeparkar, President and Shri Rakesh Kumar, Member (T) Shri Rajesh Chibber, Advocate, for the Appellant. Shri A.K. Rastogi, DR, for the Respondent. [Order per: Rakesh Kumar, Member (T)]. - This is an appeal against Order-in-Appeal No. 369-CE/MRT-1/2004 dated 21-5-04 passed by CCE, Meerut-I by which the Commissioner (Appeals) while upholding the duty dema ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... providing valves and spindles for cylinders etc. were Rs. 6,56,908/- the amounts collected in this regard from the customers were Rs. 80,80,842/- and thus the appellant had charged excess amount of Rs. 74,23,934/- from the customers on which duty amounting to Rs. 6,27,786/- was chargeable. 2.2 After issue of show-cause-notice to the appellant proposing recovery of short paid duty along with interest and also imposition of penalty on them under Section 11AC of Central Excise Act, 1944 read with Section 173Q(1) of Central Excise Rules, 1944, the matter was adjudicated by the Additional Commissioner vide Order-in-Original dated 31-10-01 by which the duty demand of Rs. 6,27,786/- along with interest was confirmed against the appellant and bes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the gas sold by them. 3.2 Shri A.K. Rastogi, ld. Departmental Representative defending the impugned order pleaded that the amounts, in question, being charged towards maintenance and repairs of cylinders, Cylinder rental, cylinder testing, transportation of cylinder etc. are not genuine expenses, that the amounts being charged by the appellant from their customers under the heads of repair, maintenance and testing of cylinder, cylinder rental, freight etc. are highly inflated and this is being done in order to depress the assessable value, that this is clear from the fact that these charges were being recovered even from those customers who were bringing their own cylinders, that in these circumstances, the Hon'ble Supreme Court's judgm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing of highly inflated amounts towards cylinder repair and maintenance, 'cylinder testing', 'cylinder freight', 'valve and spindles charge' from all the customers including those who purchased gas in their own cylinder, came to light when Jurisdictional Central Excise Officers started the investigation sometime in July, 1999. We, find that amounts being collected by the appellant from their customer by issuing debit note, towards cylinder maintenance/repair charges, cylinder freight, cylinder testing etc. are far in excess of the actual expenditure incurred by them in this regard and these amounts are being charged even from those customers who brought their own cylinders and in whose case there is no question of any cylinder maintenance or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ltd. v. Commissioner of Central Excise, Bhubaneswar-I reported in 2002 (147) E.L.T. 586 has held that when the assessee were diverting the cost of aerated waters being cleared by them towards the cost of transportation, the Hon'ble Supreme Court's judgment in the case of Baroda Electric Meter (supra) would not be applicable and the excess transportation charges would be includible in the assessable value. In this regard para 3.8 of the judgment is reproduced below :- "3.8 From the above evidences, it becomes quite clear that the cost of the Aerated Waters was being diverted towards the cost of the transportation. When buyers are collecting the goods at the factory gate and are not taking the transportation either in the vehicle arranged ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for the vehicles. In these circumstances, the question of realisation of any transportation cost from their customers does not arise at all. The ratio of the various case laws referred to and relied upon by the learned Advocate is thus not applicable to the facts of the present case. It is not a simplicitor case of realisation of extra freight than the actual quantum spent, but the allegations are diversion or cost of Aerated Waters towards transportation, which stand proved against the appellant company by production of affirmative and tangible evidence produced by the Revenue and as discussed above. Accordingly, we hold that the adjudicating authority's Order for inclusion of such amounts in the assessable value of the Aerated Waters, is ..... X X X X Extracts X X X X X X X X Extracts X X X X
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