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TMI Blog2009 (12) TMI 379X X X X Extracts X X X X X X X X Extracts X X X X ..... ing to demand the duty on the amount of 7% of the price of the finished goods collected by the appellant in the name of Transit risk insurance/Transit insurance" and rejecting the claim of various discounts from the assessable value made by the appellant. The total Central Excise duty demanded is Rs. 2,25,20,275/-. In addition to demand of interest, amount equal to Central Excise duty demanded has been imposed as penalty under Section 11AC of Central Excise Act, 1944. Further, confiscation of the goods has also been ordered and a fine in lieu of confiscation of Rs. 2.5 crores has also been imposed. 2.Heard both sides. Before we proceed further, it has to be noted that the question of liability of the appellant for payment of duty on transp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... covered during the period. Feb., 1999 to Sept., 2003, works out to 7% of the sale value. It is not clear as to when the general agreement on sale was entered into. 7.6 The demand relating to the period October, 2003 to 2004 has been raised after the appellant periodically furnished details of insurance premium actually paid by them to the insurance company. 7.7 The claim that the issue of insurance charges was raised by the Department in 1994 and has been decided in 1995 and therefore extended period cannot involved is not acceptable in-as-much as the Asstt. Commissioner's order permits only amounts actually paid towards insurance as deduction. 8. The following emerges : (a) Order of the AC issu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed some letters from buyers wherein the buyers have accepted the conditions and asked the appellants to arrange for special packing and transportation and agreed to pay charges. Further, general terms of sale issued by the appellant on 17-6-99 were also produced which clearly mention that where the buyer wants delivery at his premises after clearance from the factory, 7% would be charged and in such a case appellants would replace the glasses which break during transportation and appellants would also provide special packing. 4. Learned advocate submitted that the Commissioner in the impugned order has reproduced the relevant portion of the order of the Tribunal and has stated that the issue is no more res-integra. In view of the order of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r the buyer to buy at the factory gate. The show cause notice has been issued without disputing the fact that there was a sale at the factory and without showing any evidence that transit insurance and special packing charges were not optional or were illusory. The main question which arises is as to whether the sale was at the factory gate and whether the transit insurance was optional. If the sale is not at the factory gate, the transit insurance becomes includible. No evidence has been produced to show that the sale was not at the factory gate. Again, there is no evidence to show that the buyers did not have option as regards transit insurance. Therefore, reliance of the Commissioner on the order passed by the Tribunal without considerin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... udible in the assessable value. It has to be noted that Hon'ble Supreme Court decision was for the period when the old Section 4 was in force and under new Section 4 for each removal, the transaction value has to be determined. Unfortunately, the department has proposed to include the whole amount collected towards special packing, transit insurance and there is no segregation at all. If there was segregation, only the question of examination as to whether the special packing charges are includible or not, would arise. Therefore, we are unable to consider this issue. 8. Second issue relate to various discounts claimed by the appellant as deduction. The discounts have been disallowed on the ground that the same were not reflected in the inv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... have intimated the Superintendent of Central Excise of concerned Range about the revised discount structure w.e.f. 16-12-02. We take note of the fact that in this case, it is not the case of the Department that no discount has been passed on. No evidence has been produced that the buyers did not know about the discount structure. The only ground on the basis of which the discount has been disallowed is that the same is not shown in the invoices and is not transparent. Further, as rightly observed by the Board in circular, Central Excise duty is payable on the net transaction value. The Department has not shown that no transaction value is shown in the invoice. Therefore, discount passed on by way of issue of credit note was admissible payme ..... X X X X Extracts X X X X X X X X Extracts X X X X
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