TMI Blog2010 (7) TMI 363X X X X Extracts X X X X X X X X Extracts X X X X ..... . Khandeparkar, Shri Rakesh Kumar, JJ. REPRESENTED BY : Shri Nitin Anand, DR, for the Appellant. Shri R.K. Hasija, Advocate, for the Respondent. [Order per : Rakesh Kumar, Member (T)]. The facts leading to these appeals are, in brief, as under. 1.1 The respondents are manufacturers of piston/rings chargeable to Central Excise Duty under Chapter 84 of the Central Excise Tariff. Both the respondents clear the goods manufactured by them to their depots from where the same are sold and the duty is paid by them at the time of clearance from their factory on the price prevailing at depot at the time of removal. However, both the respondents claimed that they were giving turnover discounts to their customers which are finalise ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... only at a later stage. He also observed that when a discount is not offered at the time of sale from depot, the same is not eligible for deduction for determining the assessable value, as permitting the deduction of such discounts would be contrary to the provisions of Rule 7 of the Central Excise Valuation Rules. It is on this basis that the Assistant Commissioner by the provisional assessment finalisation orders confirmed Central Excise Duty demand of Rs. 56,62,809/- against M/s. Goetze (India) Ltd. alongwith interest and duty demand of Rs. 5,09,790/- alongwith interest against M/s. Escorts Pistons Ltd. Both the appellants filed appeals to the Commissioner, Central Excise (Appeals), Chandigarh, who disposed of these appeals by a common or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es v. CCE, Nasik reported in 2008 (226) E.L.T. 401 (Tri. - Mumbai), wherein it was held that the deductions of the discount, in respect of, which there is no evidence that the same had actually been passed on to the customers is not admissible. He pleaded that same view had been taken by the Tribunal in the case of Electrolux Kelvinator Ltd. v. CCE, Jaipur-I reported in 2004 (163) E.L.T. 234 (Tri. - Del.), wherein it was held that quantity discount is permissible only to the extent actually given and availed of and that certain discounts although originally deducted while discharging duty at the time of clearance of the goods, but were subsequently were not passed on for the reason that the buyers were not meeting the purchase targets, such ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the customer is decided only at the end of the year. The point of dispute as to whether when the turnover discount is not given at the time of sale but is determined at a later date, its deduction is permissible. Hon ble Supreme Court in the case of Union of India v. Madras Rubber Factory Ltd. and others reported in 1995 (77) E.L.T. 433 (S.C.) while interpreting the provisions of Section 4 of Central Excise Act, as it stood during the period prior to 1-7-2000 and in which there was a specific provision for deduction of trade discount from the assessable value, has held that the deduction of trade discounts known and understood at the time of removal of goods is permissible even if the same are quantified later and in para 58 and 60 of the j ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 86) E.L.T. 229 (Tri. - Del.) the Tribunal has held that the deduction of turnover discount cannot be disallowed as there is no legal provision for imposing the condition that for permitting the deduction of trade discount, the same has to be passed on to the buyers at the time of sale. However, we agree with the contention of the learned Department Representative, that as held by tribunal in the case of VIP Industries v. CCE, Nasik and Electrolux Kelvinator Ltd. v. CCE, Jaipur-I (supra), the deduction of trade discounts for determining the assessable value is permissible only to the extent such discounts have actually been passed to the buyers. We find that the extent to which the turnover discounts were actually passed on to the buyers has ..... X X X X Extracts X X X X X X X X Extracts X X X X
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