Contact us   Feedback   Annual Subscription   New User   Login      
Tax Management India .com
TMI - Tax Management India. Com
Extracts
Home List
← Previous Next →

2015 (9) TMI 1023 - CESTAT MUMBAI

2015 (9) TMI 1023 - CESTAT MUMBAI - 2015 (329) E.L.T. 341 (Tri. - Mumbai) - Valuation of goods Deduction of freight from the assessable value - Held that:- freight shown in the invoices in addition to basic price of the goods. It is clear from the terms of the bid documents also that basic price and other components have to be indicated separately. Therefore, there is no dispute that basic price and the freight components are clearly indicated separately in the invoices and therefore criterion .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

favour of assessee. - Appeal No. E/1779/05-MUM - Final Order No. A/1533/2015-WZB/EB - Dated:- 1-5-2015 - P. K. Jain, Member (Technical) And Hon ble Mr Ramesh Nair, Member(Judicial), JJ. For the Appellants : Shri. Vishal Agrawal, Advocate For the Respondent : Shri. Ashutosh Nath, Asst. Commissioner(A.R.) ORDER Per : Ramesh Nair This appeal is directed against Order-in-Appeal No. BPS(220)16/2004dtd. 10/6/2004 passed by the Commissioner of Central Excise & Customs(Appeals), Aurangabad wherein L .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

) 23/SSIL/(JFTC) Adj/2001 dated 2/3/2001 wherein deduction on account of freight was proposed to be denied and consequently demand of duty of ₹ 29,29,426/- for the period from 7/2000 to 1/2001 was issued. In the show cause notice it was contended that the deduction on account of freight is allowed only if the assessee showed freight separately in the invoices and only in the actual cost charged from the buyers. If the assesse had a system of pricing and sale at uniform prices inclusive of .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

Ld. Counsel for the appellant submits that as per the bid documents of Ministry of Communication Department of Telecommunication Service. The price for supply is composite price but as per the condition, while supply the goods in the sale invoice, the appellant required to indicate basic price and other components of the price individually. He submits that as per their system of clearance of the goods they have shown bifurcation of composite price in the sale invoices issued to the department of .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

e apprehension of the officers that freight is equated freight. He submitted some sample invoices from which he pointed out that the freight charges in the sale invoices is actual freight and not equated freight. Since entire case has been proceeded on the assumption that the freight charges by the appellant is equated and not the actual freight, he submits that authorities have proceed on the wrong assumption. He submits that the appellant right from the adjudication stage have been submitting .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ation should not be made part and parcel of the transaction value, with this concept only statutory provision was made for deduction of transportation charges from the assessable value of the goods for the purpose of charging excise duty. Without prejudice he also submits that in view of the various judgments even if it is presumed that the freight in the present case is equated freight though not admitted, the deduction of said freight is also allowable. He placed reliance on the following judg .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

of sale is at composite price. As per the condition of supply it is obligations on the appellant to ensure the quality testing at the place of delivery with this fact sale of the goods is taken place at the place of delivery and not at the place of removal therefore deduction of transportation is not allowable. In this support, he placed reliance on following judgment: (a) Hard Castle Petrofer Pvt. Ltd. Vs. Commissioner of C. Ex. Jammu(J&K)[2014(304) ELT 576 (Tri- Del.)] (b) Commissioner of .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

al submissions. 5. Before arriving at conclusion it is necessary to go through the factual matrix, on perusal of Bid documents particularly para 9 thereof which is reproduced below: 9.1 The bidder shall give the total composite price inclusive of all levies & taxes, packing forwarding, freight and insurance etc. The basic unit price and all other components of the price need to be individually indicated against the goods it proposes to supply under the contract as per price schedule given in .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

as per price schedule given in Section VII for all the items given in schedule of requirement. 9.3 The prices quoted by the bidder shall remain fixed during the entire period of contract and shall not be subject to variation on any account. A bid submitted with an adjustable price quotation will be treated as non-responsive and rejected. 9.4 The unit prices quoted by the bidder shall be in sufficient detail to enable the purchaser to arrive at prices of equipment/system offered. 9.5 DISCOUNT, if .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

eads like ED, sales tax, insurance, freight and other taxes paid/payable as per clause 9.2(i) is for the information of the purchaser and any change in these shall have no effect on price during the schedule period of delivery. 9.7. The freight by sea for transportation of equipments/Stores from the nearest port in the main land to Andaman & Nicobar Islands will be reimbursement to the supplier a the concessional rates levied by Ministry of Water and Surface Transport on production of proof. .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

es /charges that shows that basic prices was recognized. There is also a condition in the said terms that all these elements shall be quoted separately, item wise. Since component like freight, service tax, insurance varies from destination to destination, basic price does not remain uniform and it keeps on changing depending upon the different quantum of these components. It is also observed that condition of the bid that the testing of the product shall be carried at the place of delivery even .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

nature of the product this installation/testing cannot be criteria that the goods are sold at the consumer s place. When the terms of the bid as mentioned above, as regard fact of place of sale, it is clear that sale of the goods has taken place at the time of removal of the goods from the appellant s factory and therefore it is factory gate sale hence the deduction on account of transportation must be allowed. The deduction of transport from the value of the goods is mandatory under Rule 5 of C .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

oval upto the place of delivery of such excisable goods.? Explanation 1. - Cost of transportation includes - (i) the actual cost of transportation; and (ii) in case where freight is averaged, the cost of transportation calculated in accordance with generally accepted principles of costing. Explanation 2. - For removal of doubts, it is clarified that the cost of transportation from the factory to the place of removal, where the factory is not the place of removal, shall not be excluded for the pu .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

for delivery at a place other than place of removal. (b) Cost of freight should be in addition to the price for the goods. (c) Cost of transportation should shown separately in the invoices. To ensure the above, it is pertinent to look at the invoices scanned copy which is reproduced below:- As regard the first criterion, the place of removal is factory gate, however the goods were delivered at customer place therefore goods were sold for delivery not at the place of removal (i.e. factory gate) .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 



|| Home || Acts and Rules || Notifications || Circulars || Schedules || Tariff || Forms || Case Laws || Manuals ||

|| About us || Contact us || Disclaimer || Terms of Use || Privacy Policy || TMI Database || Members || Site Map ||

© Taxmanagementindia.com [A unit of MS Knowledge Processing Pvt. Ltd.] All rights reserved.

Go to Mobile Version