Subscription   Feedback   New User   Login      
Tax Management India .com
TMI - Tax Management India. Com
Articles Highlights TMI Notes SMS News Newsletters Calendar Imp. Links Database Experts Contact us More....
Extracts
Home List
← Previous Next →

M/s. Luminous Electronics Pvt. Ltd., Shri Navneet Kapoor, MD, Shri Rakesh Malhotra, Director And Shri Sunil Bhalla, Director Versus C.C.E. Delhi-II

Valuation of goods sold through dealers - inclusion of the expenditure incurred by the wholesale dealers in the assessable value of the goods sold by the appellant to such wholesale dealers - Held that:- Emphasis is laid by the Revenue on the clause that in the event that the wholesale dealer is not able to lift the specified quantities mentioned in the agreement, the appellant may increase the price based on the volume of purchase by the dealers. It was sought to be argued that such condition w .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ity and advertisement by the dealer will certainly benefit them by higher sales and higher profit. To say such publicity is only to be treated as a beneficial act for the appellant is not tenable. There is no obligatory, legally bound expenditure by the dealer for such publicity. Considering the legal position we find the impugned order is not sustainable. See COLLECTOR OF CENTRAL EXCISE, BARODA Versus BESTA COSMETICS LTD. [2005 (3) TMI 129 - SUPREME COURT OF INDIA ] - Accordingly, the same is s .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

are engaged in the manufacture of power inverters and UPS system liable to Central Excise duty. They clear goods with brand name Luminous , Safe Power and TEZ . The brand name TEZ belongs to M/s SAR Silicon Systems (P) Ltd. (SAR). The brand name luminous was owned by the main appellant till 31.01.2004 and thereafter was purchased by SAR. The appellant sell their finished goods to 3 types of customers. a) Wholesale dealers, SAR and M/s Radiant Power Systems (P) Ltd. (Radiant) who in turn sell t .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ities on their own to promote their sales. Certain investigations were conducted by the officers of the Department. Based on the investigation, a SCN dated 28.04.2005 was issued to the main appellant demanding duty of ₹ 84,79,579/- for the period April 2000 to March 2004. The demand is with reference to the expenditure incurred by their wholesale dealers (SAR and Radiant) after reducing the amount of expenditure reimbursed by the main appellants. The case was adjudicated, the Original Auth .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

hey were not required to include the expenditure borne by wholesale dealers on advertisement and publicity in the assessable value. In respect of such advertisement activities by the dealers, benefit accrues both to wholesale dealers as well as the appellants. The appellants have included the expenditure incurred by them for advertisement of their own and the expenses reimbursed by them through the dealers for such advertisements. This fact has not been disputed. As far as the expenditure incurr .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

, 100% expenditure are borne by the appellants. Where the advertisement activity benefits both the appellants as well as the dealers, the expenses are shared in the ratio of 60:40 between the appellants and the dealers. d) The wholesale dealers were entitled to market the goods in such manner as they think fit. The expenditure towards advertisement and publicity incurred by these wholesale dealers are not on behalf of the appellants. Addition of such expenditure in the assessable value of finish .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

additional amount at the point of time when the goods are sold. e) Reliance was placed on various decided cases by the Tribunal and the Hon ble Supreme Court. 5. The Ld. AR reiterated the findings in the impugned order. He submitted that in the contract between the appellant and the wholesale dealers, there is a stipulation of minimum volume of sales. If the volume falls below the said threshold, the appellant can charge higher price for the products. In such circumstances, the sale is not in u .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

an avoid increase in the price. 6. We have heard both the sides and examined the appeal records carefully. 7. The point for decision is the inclusion of the expenditure incurred by the wholesale dealers in the assessable value of the goods sold by the appellant to such wholesale dealers. The case of Revenue is that only two wholesale dealers are dealing with the entire product of the appellants, and hence, they have commercial interest with the appellants. Consequently the expenditure incurred b .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ssable value. When the expenses towards advertisement and publicity are solely borne by the dealers, the appellants are contesting the includibility of such expenditure in the assessable value. We find a similar issue came for consideration by Hon ble Supreme Court in TVS Motors Co. Ltd. [2016 (331) ELT 3(SC)]. The Supreme Court examined the scope of the term any amount that the buyer is liable to pay to . The Supreme Court s findings are: 11. The expression any amount that the buyer is liable t .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ods would only mean that but for the payment of the additional amount, the sale of the goods would not take place. When we keep in mind the aforesaid legal position, we find no error in the view taken by the Tribunal giving benefit to the assessee. Both the sides were in unison in accepting the position that no major change had been incorporated w.e.f. 1-7-2000 with emphasis on the different transaction value from the assessable value , the essence of valuation principles had not undergone major .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

510 (Tri. Del)], the Tribunal examined the issue of inclusion of advertisement expenditures borne by the dealers in the assessable value. The Tribunal concluded that on going through the appellant s agreements with their dealers, we find that there is nothing in their agreements from which it can be concluded that appellants had enforceable legal right against the dealers to insist on incurring of certain amount of expenses on advertisements and publicity of the appellant s products. Just a Clau .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ere is a discretion as to whether or not to advertise the assessee s products, there is no enforceable legal right with the assessee to insist on the advertisement under the agreement. 10. In Hero Honda Motors Ltd. [2014 (324) ELT 404 (Tri. Del)], the Tribunal examined the similar issue. It was observed that the contract required the dealers to vigorously promote, develop and maintain sales of the products and parts to the satisfaction of the appellant. Such contract cannot be treated as enforce .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 

what is new what is new
  ↓     Latest Happenings     ↓  

Highlight: National Advisory Committee on Accounting Standards - Tenure of the NACAS extended from one year to two years

Notification: National Advisory Committee on Accounting Standards

Forum: Duty Drawback- Urgent

Notification: Central Government appoints the 20th September, 2017 as the date on which proviso to clause (87) of section 2 of the Companies Act 2013, shall come into force - "subsidiary company" or "subsidiary"

Highlight: Restriction on number of layers for certain classes of holding companies - More than two layers of subsidiaries not allowed subject to certain exceptions.

Forum: GST on RCM on rent in a unregistered state

Forum: COMPOSITION SCHEME

Forum: Input Tax Credit - Reg

Forum: GST Invoice

Article: Websites of Government Departments need lot of improvement. We are noticing detoriations in them for example, case of website of ITAT.

Highlight: Levy of additions tax u/s 115O on distribution of dividend - shares of its profits declared as distributable among the shareholders is not impressed with the character of the profit from which it reaches the hands of the shareholder - not to be bifurcated as agriculture and non-agriculture dividend - SC

Highlight: Rate of GST on old and scrap buses - 28% or 18% - at such initial tender process initiated by the Respondents-KSRTC, the present petitions filed by the petitioners are premature and misconceived and do not require any interference by this Court at this stage. - HC

Forum: Rent a cab operator

Highlight: In view of amendment made u/s 132A of the Income Tax Act, 1961 by Finance Act of 2017, the 'reason to believe' or 'reason to suspect', as the case may be, shall not be disclosed to any person or any authority or the Appellate Tribunal, SC dismissed the appeal of the assessee

Highlight: Validity of Assessment Order - period of limitation u/s 153 (2A) is applicable even if the entire order was not set aside but matter was remanded back for for limited aspects with directions - HC

News: Note ban was a shake-up, achieved its main objectives

Notification: Amendments in the notification No.5/2017- Integrated Tax (Rate) dated the 28th June, 2017.

Highlight: Levying interest u/s 234C - interest is to be charged on the returned income and not on assessed income.

Highlight: Accrual of income - sale of right to develop and sell incentive FSI under LOI - till the conditions of LOI are fulfilled transfer is not complete and income does not accrue to the assessee

Highlight: TPA - determination of ALP - TP adjustment by applying Bright Line Test (BLT) is not sustainable on protective basis having no statutory mandate.

Highlight: Safeguard Duty - Advance License Scheme - as there is no exemption from safeguard duty leviable under Section 8C, which is imposed on the goods imported from China, the importer has to pay safeguard duty

Highlight: Manufacture - process of cutting of waste plastic container - Such plastic containers before and after cutting are nothing but waste / scrap - Not a manufacturing activity as no new product emerges.

News: NITI Aayog and Govt. of Assam organizes workshop on health sector reforms in Guwahati; launches SATH- Sustainable Action for Transforming Human Capital

Notification: Seeks to amend notification no. 5/2017- central tax(rate) dated 28.06.2017 to give effect to gst council decisions regarding restriction of refund on corduroy fabrics

Notification: Seeks to amend notification no. 2/2017- central tax(rate) dated 28.06.2017 to give effect to gst council decisions regarding gst exemptions

Notification: seeks to exempt Skimmed milk powder, or concentrated milk

Notification: Seeks to amend notification no. 2/2017- integrated tax(rate) dated 28.06.2017 to give effect to GST council decisions regarding GST exemptions.

Notification: Seeks to amend notification no. 1/2017- central tax(rate) dated 28.06.2017 to give effect to gst council decisions regarding gst rates

Notification: Seeks to amend notification no. 1/2017- integrated tax(rate) dated 28.06.2017 to give effect to gst council decisions regarding gst rates.

News: Notification Issued For GST Actionable Claim On Branded Food Products

Highlight: Classification printed computer stationary/manifold Business Forms - to be classified under Chapter Heading 4820.00 or under Chapter Heading 4901.90 - items like A4 sheets, advertisement and job card to be classified under Chapter 49

Article: RCM Applicability to persons not liable to get registered us 23(1)

Article: Credit of unsold stock [Section 140(3)] - Actual Credit as well as Notional Credit - Part-I - GST Transitional provisions

News: GST Refund - Blockage of Working Capital of Exporters - earlier also there was a normal blockage of funds for a period of 5-6 months at least

News: Clarification about Transition Credit - ₹ 1.27 lakh crore of credit of Central Excise and Service Tax was lying as closing balance as on 30th June, 2017 - claim of credit of ₹ 65,000 crore is not unexpected

Article: 20 Things You must know about E Way Bills in GST Law

Article: MISTAKES IN DRAFTING

Highlight: The Customs and Central Excise Duties Drawback Rules, 2017 and All Industry Rates (AIRs) of Drawback related changes -reg. - Circular

Highlight: The definition of "subsidiary company" or "subsidiary" u/s 2(87) of the Companies Act, 2013 shall come into force w.e.f. 20-9-2017

Highlight: Central Government notified the All Industry Rates of Duty Drawback Schedule w.e.f. 1.10.2017 - Notification

Notification: All Industry Rates of Duty Drawback Schedule w.e.f. 1.10.2017

Circular: Investment by Foreign Portfolio Investors in Corporate Debt Securities Review

Notification: Exemptions on supply of services under UTGST Act

Notification: Rates for supply of services under UTGST Act

Notification: Exemptions on supply of services under IGST Act

Notification: Rates for supply of services under IGST Act

Notification: List of Exempted supply of services under the CGST Act

Notification: Rates for supply of services under CGST Act

Highlight: Acceptance of deposits by companies from its members - conditions relaxed in case of Specified IFSC Public company and a private company - Rule 3 amended

Notification: Rate of exchange of conversion of the foreign currency with effect from 8th September, 2017



|| 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