TMI Blog1997 (8) TMI 229X X X X Extracts X X X X X X X X Extracts X X X X ..... duty on revised assessable value which shall be arrived at after adding the additional amount realised by the said company (appellant herein) from their buyers, to the price. Which adding the additional amount to the price, the cost of transportation from the place of removal to the place of delivery and the cost of insurance on the freight for transportation of such goods shall be excluded. That authority also directed that amount of Rs. 6,67,932.89 already deposited by the appellant on such short-payment being pointed out by Revenue be adjusted against the duty liability so arrived at. It also imposed a personal penalty of Rs. 1,00,000/- only on the appellant under Rule 173Q only. Hence this Appeal before the Tribunal. 2.1 Ld. Advocate, Shri S.K. Bagaria has submitted that the said goods are sold by the appellant to various industrial consumers, price for which were arrived at after negotiation with each buyer. The appellant submitted price list in each case separately to the Revenue referring to the contract of supply of the goods struck with each of such buyers. This was the basic price at which goods were supplied to the buyer at the factory gate. At times, the buyer go ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... submission from the foregoing data is that there was no intention on the part of the appellant to depress the value of the excisable goods by collecting extra money in the garb of transportation charges and thus evade duty as was alleged in the show cause notice and a penalty of Rs. 1 lakh imposed on the appellant is not warranted. 2.5 In support of his submission at para 2.2 above, ld. advocate has relied upon the following two judgments of the Tribunal, viz., 1988 (36) E.L.T. 723 (Indian Oxygen Ltd. v. C.C.E.); 1988 (36) E.L.T. 730 (C.C.E. v. Indian Oxygen Ltd.) He relies in particular on the following passages in the aforesaid reports : (i) Para 5 of 1988 (36) E.L.T. 723 (at page 725) ......where the whole-sale price is ascertainable at the factory gate, the question of transportation charges becomes entirely irrelevant. The cost of transportation from the factory gate to the place of delivery and transit expenses were not to be added to the whole-sale price at factory gate for purposes of duty under the Act......It is clear from Section 4 that the delivery and collection charges have nothing to do with the manufacture as they are for delivery of the filled cylinders ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... prejudice to his foregoing submissions, that in working out the excess realisations, the expenses on account of depreciation, repairs, maintenance etc. of rubber lined tanks as well as expenses on account of salaries and wages of the employees engaged in the said transportation activities should be excluded. Rubber lined tanks were being repeatedly used for refilling and for delivery of the materials to the buyers. In support of the aforesaid submissions, ld. advocate relies on the following judgments with their brief ratios against each of them : (a) 1997 (89) E.L.T. 553 (Herbertsons Limited v. CCE) - Cost of transportation of empty bottles brought back to the factory, additional interest earned on the deposits for crates and hire charges for bottles and crates - Not includible in assessable value. (b) 1993 (67) E.L.T. 249 (Rogers Company Private Ltd. v. Union of India) - Repairing charges for crates - Not includible in assessable value. (c) 1994 (72) E.L.T. 80 (Steelcity Beverages Private Ltd. v. CCE) - Rent and retention charges in respect of empty bottles and crates - Not includible in assessable value. (d) 1991 (56) E.L.T. 651 (Jayashree Chemicals Limited v. CCE) - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ransit insurance are liable to be excluded. That is clearly spelt out in Section 4 read with Apex Court s judgment in Bombay Tyres International Ltd. [1983 (14) E.L.T. 1896]. He further submits that there is no price under Section 4(1)(a) price available in this case in the sense that there is no standard price for any particular category of buyers at the factory gate for some length of time. Each sale is a negotiated sale and a price list on the basis of contract of supply was submitted to the department. Simultaneously, a separate contract of transportation of the excisable goods was also made by the appellant with the buyer which was never disclosed or referred to in the price list submitted by the appellant. The case is, therefore, clearly of manipulating the prices by suppressing the `transportation contract. 5.2 He further submits that this question, whether excess realisation over actual transport expenses needs to be charged to duty has been decided in the affirmative by the Tribunal in the case of Indian Hume Pipe Co. v. Collector of Central Excise, Bangalore [1997 (91) E.L.T. 81]. This judgment, ld. SDR submits, takes care of both the liability to excise duty of the ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the buyer s place, i.e. other than the place of removal, transportation expenses actually incurred alone will have to be deducted from the composite price charged by the appellant from his buyer, although for the sake of convenience the appellant have bifurcated the same in two contracts - one under the contract of supply of goods and another under the contract of transportation. At the time of supplying the goods, the appellant very well knows as to how much he is actually incurring on cost of transportation because the latter amount is going to be re-imbursed by it to the actual transporter who places his truck for carrying the tanker. It is not the case of the appellant that it has its own fleet of trucks carrying the special tankers and necessarily it has to rely on averages of past year. 7.4 We also note that no evidence has been brought on record by the appellant to prove that the department knew about the practice of the appellant (i) having separate contract of transportation and (ii) raising separate bill for transportation expenses on a buyer. This circumstance by itself is enough to prove the charge of depression of prices when the contract is for delivery of goods at ..... X X X X Extracts X X X X X X X X Extracts X X X X
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