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2015 (11) TMI 1038 - CESTAT MUMBAI (LB)

2015 (11) TMI 1038 - CESTAT MUMBAI (LB) - TMI - Valuation - Determination of transactional value - Whether a manufacturer of LPG selling the product in bulk, post 1.7.2000, to an OMC for further sale in packed form to dealers/domestic consumers and recovering ex-refinery price from the OMC as sale consideration is entitled to adopt ex-storage price (APM price) as the assessable value of the said product in bulk by ignoring the provisions of Section 4 of the Central Excise Act as amended w.e.f 1. .....

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lar, Larger Bench order was accepted. It is clear from the circular that Tribunal's order was not accepted on legal/judicial consideration but administrative consideration. In my considered view, for future dispute, particularly when law itself was amended, in such a situation it is the duty of this Tribunal to examine the legal issues and give a verdict on the legal issue. If the circular was issued based upon legal analysis, this Tribunal will be justified to say that Revenue could not have ar .....

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he transaction value for purposes of assessment. Similarly, this circular no where states that even wherein manufacturer (like appellant) is selling the gas in bulk at import price parity to OMCs, duty is required to be collected at APM prices. - The OMCs sold, a part of it (which is subject matter of dispute) after bottling in cylinders to domestic consumers through dealers. ONGC sold to the OMCs at a price as indicated in commercial invoices. This price was based upon Import Price Parity. Amou .....

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e price i.e. APM price collected from the dealers) from the 'Oil Pool Account/Subsidy' maintained by the Ministry of Petroleum. ONGC did not receive any subsidy or compensation from the Govt.

Transaction value of excisable goods is the price actually paid or payable for the goods when sold and includes, in addition to such price, any additional consideration which the buyer is liable to pay to, or on behalf of the assessee by reason of, or in connection with the sale. In the present c .....

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4(3)(d), which is the price mentioned in ONGC's commercial invoices. The fact that appellant's customer i.e. OMCs in turn were selling part of such goods (after bottling) to final consumer at APM price and the differential between their purchase price and APM price was being received by them as subsidy or from Oil Pool Account is of no consequence as far as section 4 of the Central Excise Act is concerned.

After 1/7/2000, the appellant has to pay duty of excise on the transaction valu .....

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able value. In the present case, there is no dispute that the value recovered by the appellant is as per the commercial invoice and therefore the commercial invoices represent the transaction value, the duty will required to be paid by the appellant on the said transaction value. The APM price recovered by the appellant's customer from the general public or their customer is not relevant for determining the assessable value of the goods sold by appellant to OMCs under Section 4 of the Central Ex .....

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umers. Therefore, the views expressed by the referral Bench are correct and the same are endorsed. - appellant has to discharge the excise duty on the transaction value which is collected from the Oil Marketing Company by issuing commercial invoices during the disputed period. - Decided against assessee. - Appeal Nos.E/3191 TO 3195 of 2005, 2259/2006 & 56 of 2007 Mum - Dated:- 10-9-2015 - Shri M.V.Ravindran, Shri P.K. Jain and Shri. P.S. Pruthi, JJ. For The Appellant : V. Sridharan, Sr. Adv. Azi .....

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the said product in bulk by ignoring the provisions of Section 4 of the Central Excise Act as amended w.e.f 1.7.2000." 2. Heard both sides and perused the records. 3. Learned Sr. Advocate appearing on behalf of the appellant submits that the Referral Order has not considered the issue which has been decided in the appellants own case. It is his submission that the issue involved in this case is whether the price at which the appellant sold the goods has to be considered for discharge of Cen .....

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ral Gases. It is his submission that the Referral Bench has opined that in MRPL case wherein identical issue was contested and decided by the Tribunal in favour of the assessee and upheld by the Apex Court is based upon an agreement between the Ministry of Finance and the Ministry of Petroleum and Natural Gas is not binding and law as per Central Excise Act needs to be applied. He would take us through the Referral Bench Order and submit that the Referral Bench has ventured into and took upon it .....

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ple which cannot be faulted with, but in the case of ONGC, Liquefied Petroleum Gas (LPG) is sold to oil marketing company at a price which has been fixed by Govt, of India and excise duty is discharged on such prices, while in order to recover the cost which are more than the price fixed by the Govt, of India, ONGC issues the commercial invoices to Oil Marketing Company. He would submit that the commercial invoice of ONGC is definitely more than the value as mentioned for discharge of excise dut .....

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& Customs (CBEC) seeking to examine the issue and send the opinion of the Government in order to brief the Learned Attorney General in reply to such D.O letter, the Secretary of the Ministry of Petroleum & Natural Gas, vide letter 01.02.2010 replied that any change in the method of valuation for payment of excise duty on LPG for the period under reference would require equivalent compensation by the Government to the Oil Marketing Companies and would amount to transfer of money from one .....

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It is his submission that ONGC supplies domestic LPG to Oil Marketing Companies and discharge excise duty on price which is less than the commercial invoice subsequently raised by the Oil Marketing Companies. The departmental representative would submit that the view taken by the Referral Bench that MRPL is sub silentio is correct and the view expressed in the MRPL case as has been upheld by the Hon'ble Supreme Court will not be applicable and hence the Larger Bench has to decide whether tra .....

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nsidering the submissions made by both sides, it is noted that the facts in the case are not much in dispute which has been brought out by the Referral Bench which we reproduce:- "The dispute in the present case relates to the valuation, for assessment of duty of LPG (domestic) cleared in bulk from the appellant factory (refinery) to Oil Marketing Companies, namely Hindustan Petroleum Corporation Ltd. (HPCL), Bharat Petroleum Corporation Ltd. (BPCK) and Indian Oil Corporation Ltd. (IOCL) du .....

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tic consumers. 5.1 The Referral Bench has noted that the Tribunal in the case of the appellant's own case has decided an identical issue vide final order No. A/1535-154 l/WZB/AHD/08 dated 06.08.2008 but has not recorded anywhere in the findings, as to why the said view is not applicable in the case in hand. It is seen from the referral order that the Referral Bench has referred the matter to the Larger Bench considering the definition of "transaction value" as incorporated in Secti .....

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Dock Ltd. Wherein it was held that subsidy amount paid by the Government to ONGC needs to be included in the transaction value; applying the ratio for referring the issue to larger bench. 5.2 At the outset it has to be recorded that identical issue was considered by the Tribunal in respect of very same assessee i.e. M/s ONGC in appeal No. E/941 to 947/2006 vide final order dated 06.08.2008 this Tribunal disposed of all the appeals in favour of ONGC recorded as under:- CUSTOMS EXCISE & SERVIC .....

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the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982? No 2. Whether it should be released under Rule 27 of CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not? Yes 3. Whether their Lordship wish to see the fair copy of the order? Seen 4. Whether Order is to be Circulated to the Departmental authorities? Yes Appellants Respondent Oil & Natural Gas Corporation Ltd. Vs. C.C.E., Surat Appearance: Shre S. Suriyananarayan, Advocate for the ap .....

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rnment of India. ONGC sells these products to oil marketing companies, namely, HPC, BPCL, IOCL, and IBP and who in turn, sell these products through public Distribution System (PDS) in the case of SKO and sell LPG through their own distributors. As per policy of the Government, these products are sold to the end consumers at the prices which are fixed but the Government under APM. Since the sale price of these products was fixed by the Government under the law, the ONGC has been passing excise d .....

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d by the govt. from the amount which they receive from the oil pool account or subsidy provided by the Government. 2. Learned Advocate on behalf of the appellant submits that the decision of the Commissioner is not correct in view of the fact that the judgment of the Larger Bench has been followed by the Tribunal in Reliance Industries Ltd. v. C.CE. vide order No. A/121 & 122/WZB/Ahd/07 dated 29.12.2006. In this decision, the Tribunal has followed the decision of the Larger Bench in GAIL cas .....

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Circular is reproduced below for ready reference: 3. At present, the assessable value of Liquefied Petroleum Gas(LPG) varies depending upon whether the sale is to the domestic consumers or to industrial consumers. However, w.e.f. 6.9.2004, the duty on LPG is to be paid by the refineries at the time of clearance of LPG. Since it may not be ascertainable in all cases whether a particular consignment is to ultimately sold to domestic consumers or to industrial consumers, the assessment of LPG at th .....

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a on behalf of the Revenue submits that after amendment of Section 4, what is relevant is transaction value. It is not disputed that oil marketing companies are paying for the SKO and LPG and there is no ground for differentiating that sale price into two categories, namely, assessable value and other value. According to him, the actual amount received by the ONGC from the oil marketing companies irrespective of the fact whether the oil marketing companies pay this amount out of their own or not .....

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red the argument advanced by both sides in detail. We find that the issue already stands decided in the cases of Reliance Industries & MRPL cited above by the Tribunal in favour of the parties and facts circumstances are the same. There is no dispute that additional consideration which is paid by the oil marketing companies has been paid out of the subsidy from oil pool account and not received from ultimate consumers. In view of the facts the Larger bench has already decided the issue and t .....

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herein. It can be seen from the above reproduced detailed order of the Tribunal in their own case and decided at Ahmedabad, that the facts in that case in hand is same and for more or less the same period for. It is also to be noticed that the Tribunal has considered the Board's Circular dated 04.09.2004 and reproduced that portion of the Board's Circular which was relevant for the issue in hand. The said relevance of the Board's Circular is also applicable in the case in hand of the .....

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In these peculiar facts and circumstances of the case, the Referral Bench should have followed the view expressed by the Tribunal in the appellant's own case. 5.3 It is also to be noted that the Board's Circular dated 30.06.2000 which has been reproduced in its entirety by the Referral Bench talks about an agreement reached between two Ministries of the Govt, of India. It is seen that the said CBEC Circular No.563/59/2000-CX dated 21.12.2000 in para 4 records as under:- "As the vie .....

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gly recently discussed first in the Board and thereafter in a meeting held between the representatives Of Department of Revenue and Department of Petroleum and Natural Gas. The various aspects of the dispute were examined and it was inter alia noted that the product was being marketed under administered price regime and the producers/marketing oil companies had no choice but to sell the products at prices fixed by OCC. It Was also a fact that LPG whether it was cleared in packed condition from r .....

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ves of Ministry of Petroleum and considering Hon'ble Apex Court direction to resolve the dispute essentially between Govt, and PSUs, it has been decided by the Govt, that in the special circumstances of production and marketing of LPG with Administered Price regime, we may accept the order of the CEGAT vide their No. 1528 to 1538/99-A dated 27.10.1999 in the case of M/s. Gas Authority of India Ltd. v. Commissioner of Central Excise subject to the condition that the refineries/oil companies w .....

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quot; 5.4 It can be seen from the above reproduced paragraph 4 of the Board's Circular, it categorically records that there was a discussion between the representatives of Ministry of Petroleum & Natural Gas and Ministry of Finance and it was decided to accept the order of the Tribunal in the case of Gas Authority of India which is a Larger Bench decision with only condition that Refinery and Oil Company who has already paid the demands will be entitled for refund but no interest is to b .....

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appellant's own case the Tribunal has held in their favour. 5.5 We were informed by the learned Counsel for the appellant that the Ministry of Finance and the Ministry of Petroleum and Natural Gas were in correspondence regarding the very same issue and the said letters are brought to our notice, which we reproduce:- [ ....Images are not reproduced ....] 5.5 It can be seen from the above reproduced letters of the Chairman of CBEC and the reply given by the Secretary of the Petroleum and Natu .....

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llant's own case. Accordingly, it has to be held that the views expressed by the Tribunal in the appellant's own case is the correct view and will be applicable. 6. Reference answered accordingly. 7. I have carefully gone through the order prepared by my learned brother, Shri M.V. Ravindran, Member (Judicial) and received by me on 14th August 2015. However, I am unable to persuade myself to agree with the same for the reasons recorded hereinafter. 8. The main reasons cited by the referra .....

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facts in the present case are more or less the same and in that case the Tribunal has also considered Board's Circular dated 4.9.2004. 8.2 I have perused the said order of the Tribunal (which is reproduced in para 5.2). I find that para 2 of the Tribunal's order lists out the submissions made by the counsel for the appellant. Para 3 lists out the submissions of the SDR and para 4 is the discussion and analysis made by the Tribunal. The said para 4 is reproduced below:- "4. We have .....

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and two Benches of this Tribunal have followed the same, we respectfully follow the same and allow the appeals filed by ONGC." By no stretch of imagination, the above mentioned order of the Tribunal can be considered a detailed order. The issue in the present case relates to the valuation of goods. The whole order does not speak anywhere about the provisions of Section 4 i.e. which deals with the valuation of goods or the Valuation Rules or anything of that type. In few sentences, it comes .....

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e price of LPG bulk was higher than the price at which the LPG was being sold to the domestic consumer. It would thus be seen that the issue before the Larger Bench was not the valuation of LPG cleared by manufacturer to oil marketing company. The Larger Bench of this Tribunal in the case of Gas Authority of India Ltd. (supra) which was pertaining to period prior to 1.7.2000 took the view that excise duty on LPG cleared in bulk for domestic consumption as per the price fixed by the OCC is the co .....

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is reproduced below: "1………… The Oil Co-ordination Committee (OCC) has been fixing from time to time different prices for LPG bulk and the LPG packed (domestic or industrial) which is meant for domestic or industrial supply. The price for LPG bulk is always higher than the price for LPG packed (domestic). As far as LPG cleared in packed form (generally in cylinders) from the refinery/extraction plant itself is concerned, these were assessed to duty on the price fi .....

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in cylinders in separate bottling units for domestic use -subsequently. The Audit and the Department took the view that as per Section 4 of the Central Excise Act, the duty has to be charged on the goods in the form in which they are cleared at the time and place of production. The OCC had fixed the price both for packed LPG for domestic purpose and the bulk LPG, and since the goods were cleared in bulk from the factory (i.e., refineries/extraction plants), they had to discharge duty at the pri .....

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try of Petroleum. The matter was accordingly recently discussed first in the Board and thereafter in a meeting held between the representatives of Department of Revenue and Department of Petroleum & Natural Gas. The various aspects of the dispute were examined and it was inter alia noted that the product was being marketed under administered price regime and the producers/marketing oil companies had no choice but to sell the products at prices fixed by OCC. It was also a fact that LPG whethe .....

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duty. After discussions with representatives of Ministry of Petroleum and considering Hon'ble Apex Court direction to resolve the dispute essentially between Govt, and PSUs, it has been decided by the Govt, that in the special circumstances of production and marketing of LPG with Administered Price regime, we may accept the order of the CEGAT vide their order No. 1528 to 1538/99-A dated 27-10-1999 in the case of M/s. Gas Authority of India Ltd. v. Commissioner of Central Excise subject to t .....

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th pay differential duty on such LPG bulk." 8.4 From the above Board's circular dated 21.12.2000, it appears to me that the Revenue was not in favour of even accepting the Larger Bench decision of this Tribunal in the case of Gas Authority of India Ltd., therefore filed appeal before the Hon'ble Supreme Court after taking opinion of Attorney General. However, the Hon'ble Supreme Court desired that the matter be resolved by the two Departments and the appeal was dismissed as not .....

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e circular was issued based upon legal analysis, this Tribunal will be justified to say that Revenue could not have argued against the circular. But that is not the case here. In case Government finds that Tribunal's decision is not acceptable due to administrative considerations such as subsidy etc., Government is empowered to issue suitable exemption notification or bring change in law to align the law with administrative desirability. 8.5 The second reason for arriving at the conclusion i .....

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h decision of this Tribunal in the case of Gas Authority of India Ltd. The Tribunal did not independently analyse the issue with reference to Section 4 or Valuation Rules Or any of the Board's circular, but simply reproduced para 7 to 13 of the judgment of this Tribunal in the case of Gas Authority of India Ltd. which was for period prior to 1.7.2000. The Larger Bench had no occasion to consider the concept of transaction value' under Section 4(3)(d) of the Central Excise Act, 1944 and t .....

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maximum, fixed under any such law, then, notwithstanding anything contained in clause (iii) of this proviso, the price or the maximum price, as the case may be, so fixed, shall, in relation to the goods so sold, be deemed to be the normal price thereof." and that there is no corresponding provision in the new Section 4 which is effective from 1.7.2000 and the new Section 4 speaks of the "transaction value" and "transaction value" alone was totally lost sight of. The sai .....

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y covered by the Circular issued by Central Board of Excise & Customs, New Delhi, bearing no. 563/59/2000-CX, dtd. 21st December, 2000 which circular is binding on the Department. However, the referral Bench in para 8.5 and 8.6 has rightly discussed in detail how the said judgment cannot be taken as precedent. 8.6 In view of the above analysis, in my considered view, none of the judgments so far issued by this Tribunal or any other court have analysed the issue with reference to the legal po .....

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ext in which it is issued. Till 6.9.2004 the petroleum products were covered under the warehousing provisions which implied that all petroleum products after manufacture were moving from one warehouse to the other warehouse without payment of duty and it is only near the final consumption destination that the duty was being paid. On 6.9.2004, the Government withdrew the facility of warehousing in respect of the petroleum products and when the facility was removed with immediate effect, in order .....

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considered view, any reliance on the circular dated 6.9.2004 in the context of the present issue will be totally misplaced. In any case, in the said order of the Tribunal the Board's circular dated 6.9.2004 was not the basis to arrive at the conclusion. 8.8 My learned brother in para 5.5 has referred to a letter written by the Chairman, CBEC, to the Secretary, Ministry of Petroleum and Natural Gas and the reply of the Secretary, Ministry of Petroleum and Natural Gas, which are reproduced in .....

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case the value has been fixed for sale by a Government Department, the same shall be adopted as the value. However, this provision was not included in the new provision w.e.f. 1.7.2000 and charging duty on Transaction Value meant that any additional consideration in or in relation to the sale of excisable goods have to be included in the assessable value. The dispute arose in the case of the above mentioned two products because these goods were being sold at a price lower than their cost price a .....

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y the Department which would not be applicable after the change in the law." The above para very clearly indicates the views of CBEC on the legal position. It is for this reason that appeals are being filed by Revenue in the Hon'ble Supreme Court against the decision of this Tribunal in the appellant's own cases as well. The reply of the Secretary, Ministry, of Petroleum, does not discuss anything about the legal aspect but only speaks about the administrative aspect and speaks that .....

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Central Excise Act, 1944 was brought into force, the present practice of assessment of price administered petroleum products should be continued. For the sake of convenience, para 26 of the circular is reproduced below: "26. The Application of new Section 4 and the valuation rules made thereunder to petroleum products may now be mentioned. Under the provisions of the existing Section 4 and rules made thereunder, the practice being followed is to assess the price administered petroleum prod .....

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there is no essential difference in the scheme of valuation of petroleum products under the old Section 4 and the new Section 4. As such, the new Section 4 and the valuation rules when applied to the marketing of price administered petroleum products as it exists should not make any material difference in assessable value of these products. However, this aspect may be examined by the Commissioners and it may be ensured that for the present the assessment of price administered petroleum products .....

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de to the Board for further examination. The reference may be made as early as possible bringing out clearly the issue involved and the views of the Commissioners thereon." On a careful examination of para 26, it does not appear that the Board has anywhere stated that even when the manufacturer was selling the goods at a price higher than the APM price, then also the APM price is to be taken as the transaction value for purposes of assessment. Similarly, this circular no where states that e .....

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inate Bench is not correct or the coordinate Bench has not taken into consideration certain aspects, there cannot be a bar not to follow the earlier order. In this connection, I may usefully rely upon the judgment of the Hon'ble Supreme court in the case of Union of India v. Paras Laminates (P) Ltd. 1990 (49) ELT 322. In para 9 of this judgment, the Hon'ble Supreme Court has held as follows: "9. It is true that a Bench of two members must not lightly disregard the decision of anothe .....

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ar goods adopted in earlier decisions must not be lightly disregarded in subsequent decisions, lest such judicial inconsistency should shake public confidence in the administration of justice. It is, however, equally true that it is vital to the administration of justice that those exercising judicial power must have the necessary freedom to doubt the correctness of an earlier decision if and when subsequent proceedings bring to light what is perceived by them as an erroneous decision in the ear .....

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s not bound to blindly follow the Tribunal's decision in the appellant's own case or the case of MRPL and hence by a reasoned order, it has rightly referred the matter to the Larger Bench for a considered decision on merits. 10. It is to be noted that after passing of the said order, at least in two cases of the present appellant, the Hon'ble Supreme Court has admitted the appeals filed by the Revenue which imply that prima facie the Hon'ble Supreme Court is of the view that the .....

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2015. However, whatever the truth may be, the fact remains that at least Civil Appeal No. 8063-8069 of 2010 as also 4197-4199 of 2010 have been admitted by the Hon'ble Supreme Court to decide the said question of law. 11. During the discussion as also in para 5.5 of the order, learned Member (Judicial) also was of the view that since the matter is pending before the Hon'ble Supreme Court in the appellant's own cases as detailed below,- (i) Civil Appeal No. D28289/2009 which has been .....

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orted in 2015-TIOL-1713-CESTAT-DEL-LB, similar issue has come up wherein the Revenue had taken similar objection and wanted that Larger Bench should not decide the issue. In that context, the Larger Bench in the said case has observed as under:- "46. Preliminary Objections by Revenue to hearing of the Reference : The Principal Commissioner, Service Tax (Mumbai-I and IV) has filed miscellaneous application No. ST/MA(ORS)/93629/15-Mum seeking adjournment hearing of this reference until final .....

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oyal Bank of Scotland N.V. filed SLP (C) 12901 of 2014. By the order dated 08.05.2014, Supreme Court directed issue of notice on the SLP and that this SLP be tagged with SLP (C) No. CC.709/2012. The applicant further pleads that the decision in ABN Amro Bank Limited was independently challenged before the Supreme Court and is pending consideration. Revenue pleads that the reference ought not to be heard and be adjourned to await the decision of the Supreme Court in appeals preferred against the .....

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ther Division Bench, which would be free to either follow the ABN Amro Bank Limited decision or could doubt its correctness and seek interpretation, by a Larger Bench. There is also no purpose served in adjourning the reference to await the decision of the Hon'ble Supreme Court. In case the ABN Amro Bank Limited decision is confirmed by the Supreme Court, that would be the governing law and the reference would not survive. The same would be the position if ABN Amro Bank Limited decision is r .....

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in interests of interpretative stability which would operate until an authoritative decision is received from the judgment of Supreme Court. There is also precedential guidance on this aspect. A two Member Bench of this Tribunal disagreed with an earlier decision of a special Bench of this Tribunal and referred the matter to the President for constitution of a Larger Bench of five Members, for reconsideration of the earlier decision of the three Member Bench, while an appeal against the three M .....

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d have been binding on all the Courts. The order of the special Bench and the order of the President referring the case to the Larger Bench were quashed for a plurality of reasons including jurisdictional. Against this order, an appeal was preferred which was allowed by the Supreme Court in Union of India v. Paras Laminates (Pvt.) Limited 1990 (49) ELT 322 (SC) 2002-TIOL-48-SC-CUS.The Supreme Court ruled that President had the jurisdiction to order the reference. The observation of the High Cour .....

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erence by special Bench when a decision of the earlier Division Bench was the subject matter of an appeal to the Supreme Court and was pending consideration by that Court. The decisions cited by Revenue in support of its contentions in the miscellaneous application including the decision in Union of India v. Jaiswal Coal Company Limited (1992) 5 SCC 733 are irrelevant and do not provide any guidance on this aspect of the matter. For the foregoing reasons, Miscellaneous application No. ST/MA(ORS) .....

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ench and just send back the reference with a direction to follow the order of this Tribunal in appellant's own case. It will also be disrespect to the President's direction. Larger Bench should examine the issue keeping in view various legal and judicial aspect and decide which may be as per the earlier order or as per the views of the referral bench. If the earlier views are not in accordance with law, the same are required to be amended for future. I also note that due to pressure of w .....

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uty if instead of examining the matter, particularly the points raised by the referral bench, we brush aside the reference or arguments. 13. With above in view, I proceed to record my views on the merits of the reference. 14. There is no dispute that appellant ONGC sold and cleared LPG (bulk) from its refinery to OMCs during the period, June, 2002 to December, 2004. The OMCs sold, a part of it (which is subject matter of dispute) after bottling in cylinders to domestic consumers through dealers. .....

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cise Rules, 2002. The OMCs received compensation/subsidy (i.e. difference between ex-refinery price paid to ONGC and the ex-storage price i.e. APM price collected from the dealers) from the 'Oil Pool Account/Subsidy' maintained by the Ministry of Petroleum. ONGC did not receive any subsidy or compensation from the Govt. 14.1 Prior to 01/07/2000, Section 4 of the Central Excise Act, 1944 provided for the concept of the 'normal wholesale price' which was replaced w.e.f. 1.7.2000 by .....

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the concept of 'Normal Wholesale Price', even though sales were effected at varying prices to different buyers or class of buyers from factory gate or Depots etc. had to be determined. 5. The new Section 4 essentially seeks to accept different transaction values which may be charged by the assessee to different customers, for assessment purposes so long as these are based upon purely commercial consideration where buyer and the seller have no relationship and price is the sole considerat .....

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, or on behalf of, the assessee, by reason of, or in connection with the sale, whether payable at the time of the sale or at any other time, including, but not limited to, any amount charged for, or to make provision for, advertising or publicity, marketing and selling organization expenses, storage, outward handling, servicing, warranty, commission or any other matter; but does not include the amount of duty of excise, sales tax and other taxes, if any, actually paid or actually payable on such .....

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the assessee for delivery at the time and place of removal, (ii) the assessee and the buyer are "not related and (iii) the price is the sole consideration for the sale. In the present case, admittedly, the appellant satisfied all these conditions. Therefore, the assessable, value of LPG which was sold in bulk, ex-refinery, to the OMCs should be its transaction value' as defined in new Section 4(3)(d) of the Act. 14.3 From the definition of 'transaction value', it is quite clear .....

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transaction value of the goods. 14.4 Under the contract of sale between ONGC and the OMCs in this case, the latter was liable to pay the ex-refinery price (i.e. import parity price). Therefore, it cannot be denied that the price actually paid by the OMCs to the appellant is the transaction value as defined in Section 4(3)(d), which is the price mentioned in ONGC's commercial invoices. The fact that appellant's customer i.e. OMCs in turn were selling part of such goods (after bottling) to .....

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rom the total amount to arrive at the assessable value of the excisable goods for payment of duty of excise after 1/7/2000 when new Section 4 of the Central Excise Act, 1944 came into force. In that case, the respondents were collecting full incidence of sales tax from its buyer, retained 75% of the same and only 25% of the said sales tax was paid to the State Government under the Incentive Scheme. Proceedings were initiated by the Central Excise Department by issue of a Show Cause Notice dated .....

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llip;. The valuation of the excisable goods has to be in terms of Section 4 of the Central Excise Act, 1944. The said Section was amended in the year 2000 which amendment came into effect on 1-7-2000. The legal position relating to identical sales tax incentives Scheme which would prevail in view of the unamended provision as well as amended provision, came up for consideration before this Court in Commissioner of Central Excise v. Super Syncotex (India Ltd.) 2014 (301) E.L.T. 273 (S.C.). This C .....

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e assessee, will be included. As per the aforesaid decision, the assessee/respondent herein will not be liable to pay any excise duty on the sales tax amount which was retained under the Incentive Scheme, up to 30th June, 2000. However, this component of sales tax which was retained by the assessee after 1-7-2000 shall be includible in arriving at the transaction value and sales tax shall be paid thereon.". The ratio of the above judgment is squarely applicable to the present case. After 1/ .....

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. Finally, our attention was drawn to a Circular dated 30th June, 2000 issued by the Central Board of Excise and Customs. This circular was issued in view of the coming into force of Section 4 of the Excise Act (as amended) from 1st July, 2000. 26. The circular brought to the notice of all concerned that in view of the amended Section 4 of the Excise Act, any amount actually paid or actually payable by way of excise, sales tax and other taxes shall be excluded from the transaction value. It was .....

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t assessable value, the definition of transaction value itself mentions that whatever amount is actually paid or actually payable to the Government or the relevant statutory authority by way of excise, sale tax and other taxes, such amount shall be excluded from the transaction value. In other words, if any excise duty or other tax is paid at a concessional rate for a particular transaction, the amount of excise duty or tax actually paid at the concessional rate shall only be allowed to be deduc .....

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, sales tax or other taxes is not paid at the time of transaction but paid subsequently, for example, sales tax payable under a deferment scheme." 27. Insofar as the present case is concerned, there is no doubt that 50% of the sales tax collected was retained by the assessee and was not actually paid to the exchequer nor was it actually payable since the HPC permitted the assessee to retain that amount. 28. Therefore, whichever way the issue is looked at, the fact remains that the assessee .....

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is set aside." From the above, it is clear that only the actual taxes paid from the overall transaction value are required to be deducted. In essence, whatever amount is recovered except the taxes actually paid will be the assessable value. In the present case, there is no dispute that the value recovered by the appellant is as per the commercial invoice and therefore the commercial invoices represent the transaction value, the duty will required to be paid by the appellant on the said tran .....

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