TMI Blog2007 (9) TMI 89X X X X Extracts X X X X X X X X Extracts X X X X ..... certain interest paid by M/s. TELCO Ltd. to their bankers under what is called 'Bill Marketing Scheme' (BMS for short). The appellants/assessees allowed cash discount of 1.9% to the buyer subject to condition that the discounted price of the goods be paid within 48 hours. The relevant invoices mentioned this discount separately. Under the BMS arrangement, which was provided by the buyer, the assessees collected payments of discounted price from HDFC Bank within 48 hours from the date of delivery of the goods to the buyer. No amount other than the discounted price of the goods was received by the assessees from the buyer or the bank, a fact acknowledged in the impugned orders. Under the BMS arrangement, the bank received interest from M/s. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e discounted price of the goods. The question which arises for consideration is whether the interest paid by the buyer to their bankers under the financial arrangement between them, which the assessees had nothing to do with, requires to be included in the assessable value of the goods. We have noticed two Circulars of the Board No. 354/81/2000-TRU, dated 30-6-2000 and No. 643/34/2002-CX, dated 1-7-2002, which clarified the point. Accordingly, the net price of the goods, after cash discount allowed by the seller to the buyer in a case of immediate or reasonably prompt payment of sale price by the latter, must be accepted as the assessable value of the goods inasmuch as such price is covered under the definition of 'normal/transaction value' ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ays remittance to their bankers under the above scheme, it was for them to pay interest on the moneys. This was precisely what was done by M/s. TELCO Ltd. and their bankers did not confer any monetary benefit on the assessees. Presumably, it was in similar circumstances that the Board clarified the point in the respective circulars. 4.Shri R. Raghavan, Counsel for some of the appellants also referred to Order-in-Appeal No. 56/2005 (M-II), dated 25-10-2005 passed by the Commissioner of Central Excise (Appeals), Chennai, wherein the appellate authority, on a similar set of facts, took the view that the interest received from the buyer of the goods by their bankers was not to be included in the assessable value of the goods purchased by them ..... X X X X Extracts X X X X X X X X Extracts X X X X
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