TMI Blog2007 (7) TMI 57X X X X Extracts X X X X X X X X Extracts X X X X ..... 4 dated 30-12-2004 passed by the Commissioner of Central Excise, Surat-II. Appeal No. E/09/07 is filed by M/s. Gujarat Borosil Ltd. against the order of Commissioner 6 to 8/DEM/2006 Surat, dated 21-8-2006 on the same issue for the subsequent period from Oct. 2003 to June, 2004. 2. Heard both sides. - 3. The relevant facts of Appeals No. E/1075 1076/03, in brief, are as follows : - (a) The appellant company is engaged in the manufacture of sheet glass falling under Chapter sub-heading 1702 of the Central Excise Tariff Act (CETA), 1985. (b) In respect of the appellant, the jurisdictional Assistant Commissioner, vide his Order-in-Original No. 18/PL/ 1995 dated 20-8-95, decided the issue relating to transit insurance as follow ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... expenses incurred for reimbursement of breakage of sheet glass, as no insurance company was willing to issue any policy covering transit insurance except of accident and non-delivery of the goods. (i) The Commissioner held that a sum of Rs. 5,50,17,448/- was recovered by the appellant company from the buyers as 'insurances charges for a period from 1-2-99 to 30-6-2000 but actually incurred only a sum of Rs. 17,00,168 as premium and hence Rs.5,33,17,280/- is extra consideration in relation to the sales and hence, includible in the assessable value and accordingly, duty of Rs. 80,10,012/- is recoverable. (j) For the period from 1-7-2000 to 29-9-2003, a sum of Rs.13,85,98,966/- ha been collected as cost of insurance, whereas only a sum of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ound for adding such amounts to the assessable value of the goods. He submits that the sale of sheet glass and transportation deals are two separate activities. The sale of goods, manufactured and cleared are governed by the general agreement on sale. They offer the buyers option to arrange for their own transport and take delivery of the goods at the factory gate. The aforesaid condition of sale indicate that these are rates at the ex-factory price and the price does not include freight and insurance; they are not responsible for the goods after they are delivered at the factory gate. The risk of goods passed over to the dealers after the goods are handed over. In case the buyer decides to arrange to take the delivery of sheet glass and be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... We have carefully considered the rival submissions. The appellant company has been collecting certain amounts in the name of transportation charges. Is it freight? Is it transit insurance? Is it on account of any other activity? The purpose for which the transportation cost has been collected is not apparent from the nomenclature used by them. 7.2 The investigation by DGCEI brought out the facts behind such collection. The statement of Shri Ashok Jain confirms that said 7% is not freight, it is not an actual insurance premium paid to the insurance company, it is not even equalized insurance premium paid by the company. In fact, they are paying very meagre amount of premium to the insurance company which is in the range of Rs. 11 to 16 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecovered 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 issued in 1995 permits deduction of only ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
